A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended September 30, so let’s proceed with the discussion of the hedge fund sentiment on General Communication, Inc. (NASDAQ:GNCMA).
General Communication, Inc. (NASDAQ:GNCMA) shares didn’t see a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 7 hedge funds’ portfolios at the end of the third quarter of 2016. 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 CSW Industrials Inc (NASDAQ:CSWI), Aegean Marine Petroleum Network Inc. (NYSE:ANW), and Tower International Inc (NYSE:TOWR) to gather more data points.
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We follow over 700 hedge funds and other institutional investors and by analyzing their quarterly 13F filings, we identify stocks that they are collectively bullish on and develop investment strategies based on this data. One strategy that outperformed the market over the last year involves selecting the 100 best-performing funds and identifying the 30 mid-cap stocks that they are collectively most bullish on. Over the past year, this strategy generated returns of 18%, topping the 8% gain registered by S&P 500 ETFs. We launched this strategy 2.5 years ago and it returned more than 39% since then, vs. 22% gain registered by the S&P 500 ETFs.
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Now, we’re going to take a peek at the key action surrounding General Communication, Inc. (NASDAQ:GNCMA).
What have hedge funds been doing with General Communication, Inc. (NASDAQ:GNCMA)?
At the end of the third quarter, a total of 7 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 0% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards GNCMA over the last 5 quarters. With hedge funds’ capital changing hands, there exists a few noteworthy hedge fund managers who were boosting their holdings substantially (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Renaissance Technologies, one of the largest hedge funds in the world has the biggest position in General Communication, Inc. (NASDAQ:GNCMA), worth close to $9.1 million, amounting to less than 0.1%% of its total 13F portfolio. Coming in second is D. E. Shaw’s D E Shaw, which holds a $2.4 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Some other members of the smart money that hold long positions encompass John Overdeck and David Siegel’s Two Sigma Advisors, Cliff Asness’s AQR Capital Management and Peter Algert and Kevin Coldiron’s Algert Coldiron Investors. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.
We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Highbridge Capital Management. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case in this case because only one of the 800+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Citadel Investment Group).
Let’s now take a look at hedge fund activity in other stocks similar to General Communication, Inc. (NASDAQ:GNCMA). These stocks are CSW Industrials Inc (NASDAQ:CSWI), Aegean Marine Petroleum Network Inc. (NYSE:ANW), Tower International Inc (NYSE:TOWR), and GenMark Diagnostics, Inc (NASDAQ:GNMK). This group of stocks’ market values are similar to GNCMA’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CSWI | 9 | 71244 | 1 |
| ANW | 16 | 106189 | 0 |
| TOWR | 13 | 67177 | -3 |
| GNMK | 11 | 96641 | 5 |
As you can see these stocks had an average of 12.25 hedge funds with bullish positions and the average amount invested in these stocks was $85 million. That figure was $14 million in GNCMA’s case. Aegean Marine Petroleum Network Inc. (NYSE:ANW) is the most popular stock in this table. On the other hand CSW Industrials Inc (NASDAQ:CSWI) is the least popular one with only 9 bullish hedge fund positions. Compared to these stocks General Communication, Inc. (NASDAQ:GNCMA) is even less popular than CSWI. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.
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