While the market is being driven by short-term sentiment influenced by uncertainty regarding the future of the interest rate environment in the U.S, the low commodity prices, and the economic dip in China, many smart money investors are keeping their optimism regarding the current bull run, while nonetheless hedging many of their long positions. However, as we know, big investors usually buy stocks with strong fundamentals, which is why we believe we can profit from imitating them. In this article, we are going to take a look at the smart money sentiment surrounding Liberty Interactive Group (NASDAQ:QVCA).
Is Liberty Interactive Group (NASDAQ:QVCA) an attractive investment now? Investors who are in the know are turning less bullish. The number of long hedge fund positions decreased by 4 lately. At the end of this article we will also compare QVCA to other stocks including International Paper Company (NYSE:IP), Roper Technologies Inc (NYSE:ROP), and Amphenol Corporation (NYSE:APH) to get a better sense of its popularity.
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To most traders, hedge funds are viewed as worthless, outdated financial tools of yesteryear. While there are greater than 8,000 funds with their doors open at present, our experts choose to focus on the top tier of this group, about 700 funds. It is estimated that this group of investors orchestrate most of all hedge funds’ total asset base, and by tailing their first-class stock picks, Insider Monkey has determined numerous investment strategies that have historically surpassed the S&P 500 index. Insider Monkey’s small-cap hedge fund strategy outperformed the S&P 500 index by 12 percentage points annually for a decade in their back tests.
Keeping this in mind, let’s take a peek at the recent action surrounding Liberty Interactive Group (NASDAQ:QVCA).
What have hedge funds been doing with Liberty Interactive Group (NASDAQ:QVCA)?
Heading into Q4, a total of 67 of the hedge funds tracked by Insider Monkey held long positions in this stock, a dip of 6% from the previous quarter. With hedgies’ sentiment swirling, there exists a few key hedge fund managers who were upping their stakes considerably (or had already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, FPR Partners, managed by Bob Peck and Andy Raab, holds the number one position in Liberty Interactive Group (NASDAQ:QVCA). FPR Partners has a $490 million position in the stock, comprising 12.3% of its 13F portfolio. On FPR Partners’ heels is JANA Partners, led by Barry Rosenstein, holding a $326 million position; the fund has 3.7% of its 13F portfolio invested in the stock. Some other professional money managers that hold long positions encompass Peter Adam Hochfelder’s Brahman Capital, and D E Shaw.
Due to the fact that Liberty Interactive Group (NASDAQ:QVCA) has witnessed declining sentiment from the aggregate hedge fund industry, it’s easy to see that there lies a certain “tier” of funds that elected to cut their positions entirely in the third quarter. Chase Coleman’s firm, Tiger Global Management LLC, was among those selling off its stock in the quarter, about $157.1 million worth. These transactions are interesting, as total hedge fund interest was cut by 4 funds in the third quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Liberty Interactive Group (NASDAQ:QVCA) but similarly valued. We will take a look at International Paper Company (NYSE:IP), Roper Technologies Inc (NYSE:ROP), Amphenol Corporation (NYSE:APH), and Campbell Soup Company (NYSE:CPB). This group of stocks’ market values resemble QVCA’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| IP | 32 | 567135 | -3 |
| ROP | 28 | 683401 | 3 |
| APH | 26 | 433051 | 3 |
| CPB | 25 | 146622 | 5 |
As you can see these stocks had an average of 27.75 hedge funds with bullish positions and the average amount invested in these stocks was $458 million. That figure was $4.22 billion in QVCA’s case. International Paper Company (NYSE:IP) is the most popular stock in this table. On the other hand Campbell Soup Company (NYSE:CPB) is the least popular one with only 25 bullish hedge fund positions. Compared to these stocks Liberty Interactive Group (NASDAQ:QVCA) is far 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.
