Should You Avoid Crown Castle International Corp. (CCI)?

Billionaire hedge fund managers such as Steve Cohen and Stan Druckenmiller can generate millions or even billions of dollars every year by pinning down high-potential small-cap stocks and pouring cash into these candidates. Small-cap stocks are overlooked by most investors, brokerage houses, and financial services hubs, while the unlimited research abilities of the big players within the hedge fund industry can easily identify the undervalued and high-potential stocks that reside the ignored corners of equity markets. There are numerous small-cap stocks that have turned out to be great winners, which is one of the main reasons the Insider Monkey team pays close attention to the hedge fund activity in relation to these stocks.

Crown Castle International Corp. (NYSE:CCI) was in 46 hedge funds’ portfolios at the end of September. Crown Castle International Corp. (NYSE:CCI) investors should be aware of a decrease in enthusiasm from smart money of late. There were 48 hedge funds in our database with Crown Castle International Corp. (NYSE:CCI) holdings at the end of the previous quarter. At the end of this article, we will also compare Crown Castle International Corp. (NYSE:CCI) to other stocks, including Korea Electric Power Corporation (ADR) (NYSE:KEP), L Brands Inc (NYSE:LB), and BB&T Corporation (NYSE:BBT) to get a better sense of its popularity.

According to most market participants, hedge funds are assumed to be unimportant, old investment vehicles of years past. While there are greater than 8000 funds with their doors open at the moment, our researchers look at the upper echelon of this group, around 700 funds. Most estimates calculate that this group of people controls the majority of the smart money’s total capital, and by keeping track of their unrivaled investments, Insider Monkey has discovered many investment strategies that have historically outpaced the broader indices. Insider Monkey’s small-cap hedge fund strategy outstripped the S&P 500 index by 12 percentage points a year for a decade in their back tests.

With all of this in mind, we’re going to go over the latest action surrounding Crown Castle International Corp. (NYSE:CCI).

How have hedgies been trading Crown Castle International Corp. (NYSE:CCI)?

At the end of September, a total of 46 of the hedge funds tracked by Insider Monkey held long positions in this stock, a decline of 4% from the previous quarter. With hedgies’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Bill & Melinda Gates Foundation Trust, managed by Michael Larson, holds the most valuable position in Crown Castle International Corp. (NYSE:CCI). Bill & Melinda Gates Foundation Trust has a $420.6 million position in the stock, comprising 2.4% of its 13F portfolio. Sitting at the No. 2 spot is Andreas Halvorsen of Viking Global, with a $354.6 million position; the fund has 1.4% of its 13F portfolio invested in the stock. Other members of the smart money that hold long positions consist of Israel Englander’s Millennium Management, John Overdeck and David Siegel’s Two Sigma Advisors, and D E Shaw.

Judging by the fact that Crown Castle International Corp. (NYSE:CCI) has witnessed bearish sentiment from hedge fund managers, it’s safe to say that there were a few money managers who were dropping their full holdings in the third quarter. Intriguingly, Daniel S. Och’s OZ Management said goodbye to the largest stake of the “upper crust” of funds tracked by Insider Monkey, valued at close to $66.7 million in stock, and Dmitry Balyasny’s Balyasny Asset Management was right behind this move, as the fund sold off about $26 million worth of shares. These transactions are important to note, as total hedge fund interest dropped by 2 funds in the third quarter.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Crown Castle International Corp. (NYSE:CCI) but similarly valued. We will take a look at Korea Electric Power Corporation (ADR) (NYSE:KEP), L Brands Inc (NYSE:LB), BB&T Corporation (NYSE:BBT), and Synchrony Financial (NYSE:SYF). This group of stocks’ market caps is similar to Crown Castle International Corp. (NYSE:CCI)’s market cap.

As you can see these stocks had an average of 23 hedge funds with bullish positions and the average amount invested in these stocks was $835 million. That figure was $1.87 billion in Crown Castle International Corp. (NYSE:CCI)’s case. BB&T Corporation (NYSE:BBT) is the most popular stock in this table. On the other hand, Korea Electric Power Corporation (ADR) (NYSE:KEP) is the least popular one with only 14 bullish hedge fund positions. Compared to these stocks, Crown Castle International Corp. (NYSE:CCI) 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.