Below we present the list of 5 stocks that credit markets expert Steve Ketchum likes. For our methodology and a more comprehensive list please see 9 Stocks That Credit Markets Expert Steve Ketchum Likes.
5. Gray Television, Inc. (NYSE:GTN)
The second half of our list of stocks that Sound Point Capital founder and credit markets expert Steve Ketchum likes kicks off with Gray Television, Inc. (NYSE:GTN). Ketchum’s fund owns 39,257 shares of GTN as of September 30, unchanged from the middle of 2021, and has been a shareholder of the stock since late 2015. GTN shares are in the midst of a great run, having gained 83% since the end of October 2020.
One of the 10 Best Media Stocks To Buy Now, American TV broadcaster Gray Television, Inc. (NYSE:GTN)’s $2.83 billion purchase of Meredith Corporation was recently approved by the shareholders of that company. Hedge funds like Gray Television’s strong free cash flow generation, with a yield that currently tops 30%, and believe that the mid-term elections and its stable of core ads should help the company quickly deliver.
4. Lions Gate Entertainment Corporation (NYSE:LGF-B)
Sound Point Capital made a small subtraction from its Lions Gate Entertainment Corporation (NYSE:LGF-B) holding during Q3, selling off 15% of its position totaling 12,350 shares. That left the fund with a holding of 70,063 shares. 40 of the hedge funds tracked by Insider Monkey’s database were long LGF-B on September 30, down from 50 at the end of 2020.
Yet another media and entertainment company that is found in the 13F portfolio of Steve Ketchum’s fund, Lions Gate Entertainment Corporation (NYSE:LGF-B) has a strong international streaming presence but will face increasing pressure as more competing services go global, which could be scaring some hedge funds away from the company. The possible spinoff or sale of its Starz streaming service has also been met with a tepid response from hedge funds and analysts.
3. Sinclair Broadcast Group, Inc. (NASDAQ:SBGI)
Sound Point maintained its Sinclair Broadcast Group, Inc. (NASDAQ:SBGI) position of 38,409 shares during Q3, owning a stake in the company valued at $1.22 million as of September 30. 19 hedge funds were long SBGI at the end of Q3, down from 29 at the end of 2020 and 43 at the end of 2017.
Sinclair Broadcast Group, Inc. (NASDAQ:SBGI)’s forthcoming streaming app just received a huge boost as the company finalized an agreement with the NBA that will allow Sinclair to stream games of the 16 NBA teams to which it has the local market rights. Sinclair has a similar deal in place with the NHL, while it continues to work on expanding its MLB deal as it looks to build a leading sports streaming destination for cord-cutters. Sinclair’s ad recovery continued to be strong in Q3, as core advertising grew across both its sports and broadcast segments during the quarter.
2. iHeartMedia, Inc. (NASDAQ:IHRT)
52,448 shares of iHeartMedia, Inc. (NASDAQ:IHRT) were held in the 13F portfolio of Sound Point Capital on September 30 after the fund sold off 20% of its stake in the radio broadcaster during Q3. The fund has owned a stake in iHeartMedia since Q3 of 2019, during which time its shares have gained about 60%. 28 of the hedge funds tracked by Insider Monkey’s database were long IHRT at the end of Q3.
iHeartMedia, Inc. (NASDAQ:IHRT) recently expanded on its digital initiatives, making a big leap into the metaverse with the announcement that it will begin holding live events and other experiences in the sandbox game Roblox, in addition to launching its first tokenized community in the game later this year. Hedge funds appear to be bullish on the potential for music rights holders to secure advertising and rights fees in popular digital worlds like Roblox, which has 47 million daily active users.
1. Maxar Technologies Inc. (NYSE:MAXR)
Closing out our list is Maxar Technologies Inc (NYSE:MAXR), the top stock pick of Steve Ketchum’s Sound Point Capital for each of the last three quarters. The fund owned 76,000 MAXR shares on September 30 after adding another 20,000 shares to its holding during Q3. Sound Point was one of just 13 hedge funds long MAXR on September 30 among the funds tracked by Insider Monkey, down from 22 at the end of March.
Maxar Technologies Inc (NYSE:MAXR) appears to be a compelling and undervalued pick in the defense space, where valuations have started to reset. The company recently extended its contracts with three prominent defense customers in deals worth more than $100 million combined. Maxar had sales of $437 million in Q3 and pulled in earnings per share of $0.19, both of which slightly missed estimates. The company’s growth initiatives were solid during the quarter, as it signed a contract with another U.S partner and grew its book-to-bill ratio to over 2x.
You can also take a peek at10 Tech Stocks to Buy According to Select Equity Group and Top 10 Stock Picks of Thomas Bancroft’s Makaira Partners.
