Before we spend days researching a stock idea we’d like to take a look at how hedge funds and billionaire investors recently traded that stock. S&P 500 Index returned about 5.2% during the last 12 months ending October 30, 2015. Less than 49% of the stocks in the index outperformed the index. This means you (or a monkey throwing a dart) have less than an even chance of beating the market by randomly picking a stock. On the other hand, the top 30 S&P 500 stocks among hedge funds at the end of September 2014 had an average return of 9.5% during the same period. Sixty three percent of these 30 stocks outperformed the market. Hedge funds had bad stock picks like everyone else. Micron, which lost 50% over this period, was one of hedge funds’ 30 favorite S&P 500 stocks. Anadarko Petroleum was another failed stock pick which lost more than 26%. So, taking cues from hedge funds isn’t a foolproof strategy, but it seems to work on average. In this article, we will take a look at what hedge funds think about Entravision Communication (NYSE:EVC).
Entravision Communication (NYSE:EVC) shareholders have witnessed an increase in enthusiasm from smart money of late. At the end of this article we will also compare EVC to other stocks including National Presto Industries Inc. (NYSE:NPK), CalAmp Corp. (NASDAQ:CAMP), and Iridium Communications Inc. (NASDAQ:IRDM) to get a better sense of its popularity.
Follow Entravision Communications Corp (NYSE:EVC)
Follow Entravision Communications Corp (NYSE:EVC)
Keeping this in mind, let’s take a glance at the new action surrounding Entravision Communication (NYSE:EVC).
How are hedge funds trading Entravision Communication (NYSE:EVC)?
At the end of the third quarter, a total of 19 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 6% from one quarter earlier. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
Of the funds tracked by Insider Monkey, Greg Boland’s West Face Capital has the number one position in Entravision Communication (NYSE:EVC), worth close to $39.1 million, accounting for 16.2% of its total 13F portfolio. The second largest stake is held by Royce & Associates, managed by Chuck Royce, which holds a $10.3 million position; 0.1% of its 13F portfolio is allocated to the company. Some other members of the smart money with similar optimism include Jim Simons’ Renaissance Technologies, Leon Shaulov’s Maplelane Capital and D E Shaw.
With a general bullishness amongst the heavyweights, key money managers have been driving this bullishness. Fisher Asset Management, managed by Ken Fisher, created the most outsized position in Entravision Communication (NYSE:EVC). Fisher Asset Management had $2.6 million invested in the company at the end of the quarter. Paul Hondros’s AlphaOne Capital Partners also initiated a $2.6 million position during the quarter. The other funds with new positions in the stock are Robert B. Gillam’s McKinley Capital Management, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and Chao Ku’s Nine Chapters Capital Management.
Let’s also examine hedge fund activity in other stocks similar to Entravision Communication (NYSE:EVC). We will take a look at National Presto Industries Inc. (NYSE:NPK), CalAmp Corp. (NASDAQ:CAMP), Iridium Communications Inc. (NASDAQ:IRDM), and Ashford Hospitality Trust, Inc. (NYSE:AHT). This group of stocks’ market caps match EVC’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| NPK | 11 | 78715 | 1 |
| CAMP | 14 | 32809 | -2 |
| IRDM | 12 | 20789 | 1 |
| AHT | 18 | 81309 | -2 |
As you can see these stocks had an average of 13.75 hedge funds with bullish positions and the average amount invested in these stocks was $53 million. That figure was $94 million in EVC’s case. Ashford Hospitality Trust, Inc. (NYSE:AHT) is the most popular stock in this table. On the other hand National Presto Industries Inc. (NYSE:NPK) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks Entravision Communication (NYSE:EVC) 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.
