As we already know from media reports and hedge fund investor letters, many hedge funds lost money in the third quarter, blaming macroeconomic conditions and unpredictable events that hit several sectors, with healthcare among them. Nevertheless, most investors decided to stick to their bullish theses and their long-term focus allows us to profit from the recent declines. In particular, let’s take a look at what hedge funds think about BlackBerry Ltd (NASDAQ:BBRY) in this article.
BlackBerry Ltd (NASDAQ:BBRY) has seen a decrease in activity from the world’s largest hedge funds lately. BBRY was in 18 hedge funds’ portfolios at the end of September. There were 23 hedge funds in our database with BBRY holdings at the end of the previous quarter. At the end of this article we will also compare BBRY to other stocks, including LaSalle Hotel Properties (NYSE:LHO), Teledyne Technologies Incorporated (NYSE:TDY), and Aspen Technology, Inc. (NASDAQ:AZPN) to get a better sense of its popularity.
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In the financial world there are a multitude of tools stock traders use to grade publicly traded companies. A pair of the most under-the-radar tools are hedge fund and insider trading interest. Our experts have shown that, historically, those who follow the best picks of the elite hedge fund managers can trounce their index-focused peers by a significant amount (see the details here).
With all of this in mind, let’s view the key action encompassing BlackBerry Ltd (NASDAQ:BBRY).
How have hedgies been trading BlackBerry Ltd (NASDAQ:BBRY)?
At Q3’s end, a total of 18 of the hedge funds tracked by Insider Monkey held long positions in this stock, down by 22% from the previous quarter. With the smart money’s sentiment swirling, there exists a select group of key hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Prem Watsa’s Fairfax Financial Holdings has the number one position in BlackBerry Ltd (NASDAQ:BBRY), worth close to $286.2 million, corresponding to 26.5% of its total 13F portfolio. The second most bullish fund manager is Jim Simons’ Renaissance Technologies, which holds a $75.2 million position; 0.2% of its 13F portfolio is allocated to the stock. Other professional money managers that hold long positions encompass Cliff Asness’s AQR Capital Management, D. E. Shaw’s D E Shaw and Nelson Obus’s Wynnefield Capital.
Seeing as BlackBerry Ltd (NASDAQ:BBRY) has witnessed falling interest from the smart money, logic holds that there was a specific group of funds who were dropping their positions entirely heading into Q4. It’s worth mentioning that Joel Greenblatt’s Gotham Asset Management said goodbye to the largest investment of the “upper crust” of funds watched by Insider Monkey, worth close to $13.8 million in stock. Eric Sprott’s fund, Sprott Asset Management, also dumped its stock, about $7.4 million worth of shares. These moves are interesting, as total hedge fund interest dropped by 5 funds heading into Q4.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as BlackBerry Ltd (NASDAQ:BBRY) but similarly valued. We will take a look at LaSalle Hotel Properties (NYSE:LHO), Teledyne Technologies Incorporated (NYSE:TDY), Aspen Technology, Inc. (NASDAQ:AZPN), and VeriFone Systems Inc (NYSE:PAY). All of these stocks’ market caps are closest to BBRY’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| LHO | 12 | 41358 | 2 |
| TDY | 11 | 127021 | 1 |
| AZPN | 31 | 478208 | 5 |
| PAY | 27 | 147165 | 3 |
As you can see these stocks had an average of 20 hedge funds with bullish positions and the average amount invested in these stocks was $198 million. That figure was a whooping $470 million in BBRY’s case. Aspen Technology, Inc. (NASDAQ:AZPN) is the most popular stock in this table. On the other hand Teledyne Technologies Incorporated (NYSE:TDY) is the least popular one with only 11 bullish hedge fund positions. BlackBerry Ltd (NASDAQ:BBRY) is not the least popular stock in this group, but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard AZPN might be a better candidate to consider a long position.
