What Do Hedge Funds Think of Gray Television, Inc. (GTN)?

The market has been volatile as the Federal Reserve winds down its easy money policies. Small cap stocks have been hit hard as a result, as the Russell 2000 ETF (IWM) has underperformed the larger S&P 500 ETF (SPY) by more than 14 percentage points between June 25th and the end of October. SEC filings and hedge fund investor letters indicate that the smart money seems to be paring back their overall long exposure, and the funds’ movements is one of the reasons why the major indexes have retraced. In this article, we analyze what the smart money thinks of Gray Television, Inc. (NYSE:GTN) and find out how it is affected by hedge funds’ moves.

Gray Television, Inc. (NYSE:GTN) was in 29 hedge funds’ portfolios at the end of September. GTN investors should be aware of a decrease in hedge fund sentiment lately. There were 33 hedge funds in our database with GTN holdings at the end of the previous quarter. At the end of this article we will also compare GTN to other stocks including Q2 Holdings Inc (NYSE:QTWO), LDR Holding Corp (NASDAQ:LDRH), and Costamare Inc (NYSE:CMRE) to get a better sense of its popularity.

In the financial world there are a lot of methods market participants use to analyze stocks. A couple of the most useful methods are hedge fund and insider trading moves. Our experts have shown that, historically, those who follow the top picks of the top investment managers can outperform the market by a significant margin (see the details here).

With all of this in mind, let’s review the key action encompassing Gray Television, Inc. (NYSE:GTN).

How are hedge funds trading Gray Television, Inc. (NYSE:GTN)?

Heading into Q4, a total of 29 of the hedge funds tracked by Insider Monkey were long this stock, a change of -12% from the second quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were upping their holdings substantially (or already accumulated large positions).

According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Matthew Knauer and Mina Faltas’s Nokota Management has the most valuable position in Gray Television, Inc. (NYSE:GTN), worth close to $36.5 million, amounting to 1.6% of its total 13F portfolio. The second most bullish fund manager is Whetstone Capital Advisors, managed by David Atterbury, which holds a $23.5 million position; 8.8% of its 13F portfolio is allocated to the company. Remaining members of the smart money that are bullish include Ken Griffin’s Citadel Investment Group, Columbus Circle Investors and Bart Baum’s Ionic Capital Management.

Since Gray Television, Inc. (NYSE:GTN) has experienced a declination in interest from the smart money, it’s easy to see that there were a few money managers who were dropping their positions entirely heading into Q4. Interestingly, Richard S. Meisenberg’s ACK Asset Management said goodbye to the biggest stake of all the hedgies monitored by Insider Monkey, comprising about $16 million in stock, and Dmitry Balyasny’s Balyasny Asset Management was right behind this move, as the fund cut about $12.7 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest dropped by 4 funds heading into Q4.

Let’s now take a look at hedge fund activity in other stocks similar to Gray Television, Inc. (NYSE:GTN). These stocks are Q2 Holdings Inc (NYSE:QTWO), LDR Holding Corp (NASDAQ:LDRH), Costamare Inc (NYSE:CMRE), and Krispy Kreme Doughnuts (NYSE:KKD). This group of stocks’ market values match GTN’s market value.

As you can see these stocks had an average of 17.25 hedge funds with bullish positions and the average amount invested in these stocks was $72 million. That figure was $172 million in GTN’s case. Q2 Holdings Inc (NYSE:QTWO) is the most popular stock in this table. On the other hand LDR Holding Corp (NASDAQ:LDRH) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks Gray Television, Inc. (NYSE:GTN) 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.