David Forster and Peter Wilton’s IBIS Capital Partners is a London-based hedge fund and the seventh-best performing hedge fund in Insider Monkey’s database during Q2. It was founded back in 2003 by David Forster and Charles McIntyre. Mr. Forster’s career started with the UK’s biggest newspaper publisher, News Group Newspapers, where he manned the position of Advertising Research Manager. David’s next position was more investment-related, as he worked as an equity analyst with a specialty in media for a few large investment banks, such as Merrill Lynch, Kleinwort Benson, and as a Managing Director at Salomon Smyth Barney. From 1994 until 2001 David was co-head of the top-ranked UK media equity research team.
IBIS Capital Partners’ second-most important name is that of its Portfolio Manager – Peter Wilton. His investment career started 30 years ago at Royal London Asset Management, where he was in charge of analytical coverage of the media sector, and managed many retail and institutional UK equity portfolios. In 1995 Peter joined Threadneedle Asset Management where he ran the Threadneedle UK Select Growth Fund, among others. He pushed investments in the media sector and in 2001 became a co-manager of the outstanding Threadneedle Crescendo UK Equity long/short hedge fund. Peter came to IBIS Capital Partners three years after its inception.
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Naturally, with its partners’ robust experience investing in media businesses, IBIS Capital Partners mainly invests in media and media tech businesses. Not long ago the fund also developed an interest for investing in two other sectors – Ed-Tech and e-Learning, broadening its investment scope in the process. Companies from the media sector that have the fund’s attention include internet stocks, marketing services, broadcasting and pay TV, and professional and consumer publishing companies, to name a few. The fund has two sister companies – one that runs a global media long/short hedge funds and another that runs private equity funds. IBIS Capital Partners co-founded the famous annual conference for people involved in e-Learning, called EdTechEurope.
IBIS Capital Partners’ performance data is not publicly available. However, according to our own calculations they have done extremely well over the past year. IBIS Capital had ten positions in companies with market caps above $1 billion as of March 31, which delivered returns of 21% in the second quarter. That return ranked IBIS Capital Partners seventh among the hedge funds in our database (based on their returns using the same criteria). The fund’s portfolio is valued at $48.2 million and its current AUM is unknown. Estimates in 2012 from The Association of Investment Companies (in short AIC) noted that they had assets under management of £7 million (about $11.25 million at that time), according to their management group rankings made on June 30, 2012.
Insider Monkey’s flagship strategy identifies the best performing 100 hedge funds at the end of each quarter (IBIS Capital Partners was one of those funds at the end of Q2) and invests in their consensus stock picks. This way it is always invested in the best ideas of the best performing hedge funds and is able to generate much higher returns than the market. Since its inception in May 2014, our flagship strategy generated a cumulative return of 121% vs. a cumulative gain of 66.6% for the S&P 500 ETF (SPY) (see the details here).
We’ll discuss the changes the fund made to its portfolio in the second quarter on the next page.
IBIS Capital Partners was very active in the second quarter, as it made multiple changes to its portfolio according to its most recent 13F filing with the Securities and Exchange Commission. It added four new stocks to its holdings, raised its position in one, lowered its stake in nine, and dumped one company. It made changes to all of its positions during the quarter. Let’s start with those companies that have garnered the fund’s interest.
The biggest new position IBIS Capital Partners acquired was in Live Nation Entertainment, Inc. (LYV), obtaining 54,099 shares worth around $2.63 million. The second-largest new stake was in Electronic Arts Inc. (EA), with the fund buying 8,400 shares, establishing a position in the company worth around $1.19 million. The two other new stakes were in Acxiom Corp (ACXM) and Zillow Inc (Z).
Even though IBIS Capital Partners lowered its stake in Twenty-First Century Fox Inc. (FOX) by 38% in the second quarter, this is still the stock that accounts for the bulk of its 13F portfolio at 12.75%, with the most valuable position being worth $6.15 million on June 30. Smart money investors from our database were getting more bullish on this stock, as 43 of them were long the stock at the end of June, versus just 30 at the end of March. With increased interest from hedge funds, Twenty-First Century Fox Inc. (FOX) seems like an attractive investment, hence IBIS Capital may have lowered its stake too soon. Another stock in which the fund decreased its stake by 38% was Imax Corp (IMAX), a Canadian theater company that produces IMAX cameras and projection systems. As of June 30, the fund reported holding 254,631 Imax shares, worth around $5.64 million, making it the second-largest stake in its portfolio.
It seems that IBIS Capital Partners is slowly losing enthusiasm for Activision Blizzard Inc. (ATVI), while the smart money investors from Insider Monkey’s system are getting more bullish on it. Activision Blizzard Inc. (ATVI) attracted a net total of seven more investors in the second quarter, counting 66 hedge funds long the stock on June 30. As of the same period, IBIS Capital Partners owned 15,500 of the company’s shares, worth around $1.18 million.
On the other hand, IBIS Capital Partners is becoming more optimistic about a different video game developer, Take Two Interactive Software Inc (TTWO), as are the hedge funds from our database as a whole. The fund raised its stake in the company by 145% during Q2, holding 39,548 shares worth $4.68 million on June 30. At the end of the second quarter, there were 56 investors with long positions in this company, versus 48 a quarter earlier.
The only stock which IBIS Capital Partners decided to dump in the second quarter was World Wrestling Entertainment, Inc. (WWE). The fund said goodbye to the position that was worth $6.38 million at the end of the first quarter, counting 182,546 shares at that time.
Disclosure: None
