This article presents an overview of the 5 Cheap Penny Stocks to Buy According to Hedge Funds. For a detailed overview of such stocks, read our article, 13 Cheap Penny Stocks to Buy According to Hedge Funds.
5. Qurate Retail Inc Series A (NASDAQ:QRTEA)
Number of Hedge Fund Investors: 19
Qurate Retail Inc Series A (NASDAQ:QRTEA) ranks 5th in our list of the cheap penny stocks to buy according to hedge funds. The stock’s PE ratio as of December 14 stands at 4.85.
Qurate Retail Inc Series A (NASDAQ:QRTEA) during its Q3 earnings call talked about its expectations from the 2023 holiday season and other business updates:
“In September, QVC refreshed as Monday night fashion line-up featuring Logo by Lori Goldstein, the relaunch of PM Style with Banestrand and new shows accessorized with Sean and Sean on style. Each show was developed to deliver a strong fashion point of view and include special sets and fresh production elements. At HSN, we were pleased to launch new brands and offers including C. Wonder by Christian Siriano, Birkenstock for the first time as a today’s special Sharp flexstile hair tool and Sofia Vergara’s Toti beauty line. Now, let me touch on QX customers. On a quarterly basis, total count declined 8% in the third quarter, partially offset by a 6% increase and average spend per customer, resulting in an overall 3% decline in revenue. The rate of declining count moderated in Q3 from the low double-digit declines in the first 2 quarters of 2023.
We’re seeing the biggest churn from the low end of our customer file. On Slide 8 of our earnings presentation, you can see we are stabilizing the trailing 12-month count near $8.2 million, down only modestly from $8.3 million at the end of the second quarter. Please note that while our press release discloses customer count on a trailing 12-month basis, this is a lag-on indicator and does not reflect the progress in Q3. The increase in average spend was driven by our existing and best customers and reflects our higher quality product assortment. The average dollar spend for each of these cohorts was the highest of any quarter in 2023. We are taking a variety of actions to attract new customers, retain customers and reactivate former customers.”
Read the full earnings call transcript here.
A total of 19 hedge funds out of the 910 funds tracked by Insider Monkey had stakes in Qurate Retail Inc Series A (NASDAQ:QRTEA). The biggest stakeholder of Qurate Retail Inc Series A (NASDAQ:QRTEA) was Bob Peck and Andy Raab’s FPR Partners which owns an $18 million stake in Qurate Retail Inc Series A (NASDAQ:QRTEA).
Weitz Investment Partners III Opportunity Fund made the following comment about Qurate Retail, Inc. (NASDAQ:QRTEA) in its third 2023 investor letter:
“Qurate Retail, Inc. (NASDAQ:QRTEA) continues to make full dividend payments on our preferred shares, but tangible signs of operating improvement remain elusive. In the coming quarters, management’s “Project Athens” plan (a multi-year turnaround plan designed to stabilize Qurate’s core business and expand its leadership in video streaming commerce) is projected to deliver cost savings and margin expansion opportunities that we will evaluate closely.”
4. Community Health Systems Inc (NYSE:CYH)
Number of Hedge Fund Investors: 20
Hospital healthcare services company Community Health Systems Inc (NYSE:CYH) is a Fortune 500 company whose stock was trading at around $2.63 as of December 14.
In November, Community Health Systems Inc’s (NYSE:CYH) director Wayne Smith bought 1 million shares of Community Health Systems Inc (NYSE:CYH) at $2.11 per share, worth about $2.1 million.
3. Destination XL Group Inc (NASDAQ:DXLG)
Number of Hedge Fund Investors: 21
Apparel company Destination XL Group Inc (NASDAQ:DXLG) shares were spotted in 21 hedge fund portfolios as of the end of the third quarter of 2023. The biggest stakeholder of Destination XL Group Inc (NASDAQ:DXLG) during this period was Chuck Royce’s Royce & Associates which owns a $6.7 million stake in Destination XL Group Inc (NASDAQ:DXLG).
2. Baytex Energy Corp (TSE:BTE)
Number of Hedge Fund Investors: 24
Baytex Energy Corp (TSE:BTE) recently approved a budget of $1.2 billion to $1.3 billion in exploration and development spending for fiscal 2024.
A total of 24 hedge funds in the database of Insider Monkey had stakes in Baytex Energy Corp (TSE:BTE).
1. DISH Network Corp (NASDAQ:DISH)
Number of Hedge Fund Investors: 32
DISH Network Corp (NASDAQ:DISH) tops our list of the undervalued and cheap penny stocks popular among hedge funds. The stock has a PE ratio of about 2.37.
A total of 32 hedge funds in Insider Monkey’s database had stakes in DISH Network Corp (NASDAQ:DISH).
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