The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 700 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their December 31 holdings, data that is available nowhere else. Should you consider New Frontier Corp (NYSE:NFC) for your portfolio? We’ll look to this invaluable collective wisdom for the answer.
Is New Frontier Corp (NYSE:NFC) the right investment to pursue these days? The smart money is selling. The number of long hedge fund bets decreased by 1 lately. Our calculations also showed that NFC isn’t among the 30 most popular stocks among hedge funds. NFC was in 14 hedge funds’ portfolios at the end of December. There were 15 hedge funds in our database with NFC holdings at the end of the previous quarter.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s flagship best performing hedge funds strategy returned 20.7% year to date (through March 12th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 32 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We’re going to take a glance at the key hedge fund action regarding New Frontier Corp (NYSE:NFC).
What does the smart money think about New Frontier Corp (NYSE:NFC)?
At the end of the fourth quarter, a total of 14 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -7% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards NFC over the last 14 quarters. With hedge funds’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, BlueCrest Capital Mgmt., managed by Michael Platt and William Reeves, holds the number one position in New Frontier Corp (NYSE:NFC). BlueCrest Capital Mgmt. has a $10.4 million position in the stock, comprising 0.5% of its 13F portfolio. On BlueCrest Capital Mgmt.’s heels is Fir Tree, led by Jeffrey Tannenbaum, holding a $9.8 million position; 0.7% of its 13F portfolio is allocated to the stock. Remaining members of the smart money with similar optimism comprise David Costen Haley’s HBK Investments, Glenn Russell Dubin’s Highbridge Capital Management and Paul Glazer’s Glazer Capital.
Since New Frontier Corp (NYSE:NFC) has faced bearish sentiment from the smart money, it’s easy to see that there was a specific group of hedge funds that slashed their positions entirely last quarter. At the top of the heap, Anand Parekh’s Alyeska Investment Group said goodbye to the biggest stake of the 700 funds followed by Insider Monkey, totaling about $6.1 million in stock. Andrew Weiss’s fund, Weiss Asset Management, also dropped its stock, about $1.7 million worth. These transactions are important to note, as total hedge fund interest was cut by 1 funds last quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as New Frontier Corp (NYSE:NFC) but similarly valued. These stocks are U.S. Lime & Minerals Inc. (NASDAQ:USLM), Veritiv Corp (NYSE:VRTV), Farmer Brothers Co. (NASDAQ:FARM), and Capital City Bank Group, Inc. (NASDAQ:CCBG). This group of stocks’ market values resemble NFC’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| USLM | 2 | 16994 | -2 |
| VRTV | 10 | 99081 | -3 |
| FARM | 9 | 88819 | 2 |
| CCBG | 2 | 5277 | -1 |
| Average | 5.75 | 52543 | -1 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.75 hedge funds with bullish positions and the average amount invested in these stocks was $53 million. That figure was $67 million in NFC’s case. Veritiv Corp (NYSE:VRTV) is the most popular stock in this table. On the other hand U.S. Lime & Minerals Inc. (NASDAQ:USLM) is the least popular one with only 2 bullish hedge fund positions. Compared to these stocks New Frontier Corp (NYSE:NFC) is more popular among hedge funds. Our calculations showed that top 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Unfortunately NFC wasn’t nearly as popular as these 15 stock and hedge funds that were betting on NFC were disappointed as the stock returned 1.8% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.
Disclosure: None. This article was originally published at Insider Monkey.
