Insider Monkey has processed numerous 13F filings of hedge funds and famous investors to create an extensive database of hedge fund holdings. The 13F filings submitted through the latest round of 13Fs reveal hedge funds’ positions as of the end of the final quarter of 2015. Investors can find write-ups about an individual hedge fund’s trades on numerous financial news websites. However, this article discusses hedge funds’ collective moves and analyzes what the smart money thinks of Liberty Interactive Corp (NASDAQ:QVCA) based on that data.
Liberty Interactive Corp (NASDAQ:QVCA) has seen an increase in hedge fund sentiment recently. 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 Under Armour Inc (NYSE:UA), Equinix Inc (NASDAQ:EQIX), and Analog Devices, Inc. (NASDAQ:ADI) to gather more data points.
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Liberty Interactive Corp (NASDAQ:QVCA) owns interests in subsidiaries and other companies engaged in the video and digital commerce industries. Those interests are attributable to two separate tracking stock groups, which include the QVC Group and the Liberty Ventures Group. The QVC Group comprises subsidiaries such as QVC, which sells a broad portfolio of consumer products through live merchandise-focused televised shopping programs; zulily, an online retailer acquired in October 2015 for roughly $2.3 billion; and Liberty Interactive’s interest in HSN. On the other hand, the Liberty Ventures Group comprises Liberty Interactive’s subsidiaries such as Bodybuilding.com, CommerceHub, Evite, and Right Start; Liberty Interactive’s interest in Expedia, minority interests in Interval Leisure Group, Time Warner Inc., Time Warner Cable, LendingTree and FTD; as well as other investments.
QVC’s consolidated net revenue, which accounts for approximately 88% of Liberty Interactive Corp (NASDAQ:QVCA)’s total revenue, reached $8.74 billion in 2015, down from $8.80 billion in 2014. The decrease of $58 million in net revenue was mainly driven by unfavorable foreign exchange impact and lower net shipping and handling revenue. However, QVC’s top-line results were positively impacted by an increase in units sold both in the United States and globally, and higher average selling prices per unit. Meanwhile, the company generated net earnings of $911 million in 2015, up from $626 million reported for 2014. It appears that Liberty Interactive Corp (NASDAQ:QVCA) intends to simplify its structure and focus, as its Board of Directors recently authorized management to undertake a spin-off of two soon-to-formed companies called CommerceHub Inc. and Liberty Expedia Holdings Inc. The former company will include Liberty’s CommerceHub business, while the latter will include Liberty’s interest in Expedia Inc. and subsidiary Bodybuilding.com. The aforementioned spin-offs will most likely be tax-free to shareholders and will be completed in the second quarter of 2016. The shares of Liberty Interactive are down 9% over the past 12 months and trade at a forward P/E multiple of 14.64, which is below the average of 16.55 for the companies included in the S&P 500 Index.
Keeping this in mind, let’s take a glance at the latest action encompassing Liberty Interactive Corp (NASDAQ:QVCA).
What does the smart money think about Liberty Interactive Corp (NASDAQ:QVCA)?
At Q4’s end, a total of 71 of the hedge funds tracked by Insider Monkey were long this stock, an increase of 6% from one quarter earlier. With the smart money’s capital changing hands, there exists a select group of noteworthy hedge fund managers who were upping their stakes substantially (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Bob Peck and Andy Raab’s FPR Partners has the number one position in Liberty Interactive Corp (NASDAQ:QVCA), worth close to $607 million, comprising 13.1% of its total 13F portfolio. The second most bullish fund manager is JANA Partners, managed by Barry Rosenstein, which holds a $364.5 million position; the fund has 5.1% of its 13F portfolio invested in the stock. Some other professional money managers that are bullish comprise Peter Adam Hochfelder’s Brahman Capital, D. E. Shaw & Co. L.P., founded by David E. Shaw.
As industrywide interest jumped, some big names were breaking ground themselves. JANA Partners, managed by Barry Rosenstein, assembled the biggest position in Liberty Interactive Corp (NASDAQ:QVCA). JANA Partners had $364.5 million invested in the company at the end of the quarter. Doug Silverman and Alexander Klabin’s Senator Investment Group also initiated a $82 million position during the quarter. The other funds with new positions in the stock are Aaron Cowen’s Suvretta Capital Management, Isaac Corre’s Governors Lane, and Solomon Kumin’s Folger Hill Asset Management.
The final page of this article reveals the fourth-quarter hedge fund activity in other companies with market capitalizations close to QVCA.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Liberty Interactive Corp (NASDAQ:QVCA) but similarly valued. We will take a look at Under Armour Inc (NYSE:UA), Equinix Inc (NASDAQ:EQIX), Analog Devices, Inc. (NASDAQ:ADI), and Marriott International Inc (NYSE:MAR). This group of stocks’ market caps are similar to QVCA’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| UA | 25 | 227587 | 2 |
| EQIX | 47 | 3511200 | 5 |
| ADI | 26 | 1293886 | -6 |
| MAR | 34 | 606597 | 5 |
As you can see these stocks had an average of 33 hedge funds with bullish positions and the average amount invested in these stocks was $1.41 billion. That figure was $4.89 billion in QVCA’s case. Equinix Inc (NASDAQ:EQIX) is the most popular stock in this table. On the other hand Under Armour Inc (NYSE:UA) is the least popular one with only 25 bullish hedge fund positions. Compared to these stocks, Liberty Interactive Corp (NASDAQ:QVCA) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.
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