Hedge funds and large money managers usually invest with a focus on the long-term horizon and, therefore, short-lived dips on the charts, usually don’t make them change their opinion towards a company. The second half of 2015 and the first few months of this year was a stressful period for hedge funds. However, things have been taking a turn for the better in the second half of this year. Small-cap stocks which hedge funds are usually overweight outperformed the market by double digits and it may be a good time to pay attention to hedge funds’ picks before it is too late. In this article we are going to analyze the hedge fund sentiment towards Liberty Global plc. (NASDAQ:LBTYA) to find out whether it was one of their high conviction long-term ideas.
Is Liberty Global plc. (NASDAQ:LBTYA) ready to rally soon? The smart money seems to be becoming more confident, judging by the fact that the number of investors tracked by Insider Monkey long the stock inched up by one recently. However, the level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Royal Bank of Scotland Group plc (ADR) (NYSE:RBS), Eaton Corporation, PLC Ordinary Shares (NYSE:ETN), and Health Care REIT, Inc. (NYSE:HCN) to gather more data points.
Follow Liberty Global Inc.
Follow Liberty Global Inc.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
cherezoff / shutterstock.com
With all of this in mind, we’re going to view the new action encompassing Liberty Global Inc. (NASDAQ:LBTYA).
How have hedgies been trading Liberty Global plc. (NASDAQ:LBTYA)?
At the end of September, 52 funds tracked by Insider Monkey were long Liberty Global, up by 2% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were upping their stakes substantially (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Warren Buffett’s Berkshire Hathaway has the most valuable position in Liberty Global plc. (NASDAQ:LBTYA), worth close to $689.8 million, accounting for 0.5% of its total 13F portfolio. The second largest stake is held by Philippe Laffont’s Coatue Management, with a $254.1 million position; 3.1% of its 13F portfolio is allocated to the company. Remaining professional money managers with similar optimism encompass Larry Robbins’ Glenview Capital and Dan Loeb’s Third Point.
Consequently, some big names have been driving this bullishness. Viking Global, managed by Andreas Halvorsen, assembled the most valuable position in Liberty Global plc. (NASDAQ:LBTYA). Viking Global had $95.2 million invested in the company at the end of the quarter. Jonathon Jacobson’s Highfields Capital Management also made a $68.4 million investment in the stock during the third quarter. The other funds with brand new LBTYA positions are Ken Griffin’s Citadel Investment Group, Jeffrey Bronchick’s Cove Street Capital, and Benjamin A. Smith’s Laurion Capital Management.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Liberty Global plc. (NASDAQ:LBTYA) but similarly valued. These stocks are Royal Bank of Scotland Group plc (ADR) (NYSE:RBS), Eaton Corporation, PLC Ordinary Shares (NYSE:ETN), Health Care REIT, Inc. (NYSE:HCN), and Anadarko Petroleum Corporation (NYSE:APC). This group of stocks’ market valuations are closest to LBTYA’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| RBS | 10 | 20902 | 1 |
| ETN | 38 | 668498 | 5 |
| HCN | 20 | 709585 | 0 |
| APC | 65 | 3899227 | 17 |
As you can see these stocks had an average of 33 funds with bullish positions and the average amount invested in these stocks was $1.33 billion. That figure was $2.09 billion in LBTYA’s case. With 65 funds holding shares, Anadarko Petroleum Corporation (NYSE:APC) is the most popular stock in this table. On the other hand, Royal Bank of Scotland Group plc (ADR) (NYSE:RBS) is the least popular one with only 10 bullish hedge fund positions. Liberty Global plc. (NASDAQ:LBTYA) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal, but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard Anadarko Petroleum Corporation (NYSE:APC) might be a better candidate to consider a long position.
Suggested Articles:
Most Advanced Countries In Agriculture
Dating Sites With The Highest Success Rates
Best Fast Food Chains To Work For
Disclosure: None
