Is Expedia Inc (NASDAQ:EXPE) a good bet right now? We like to analyze hedge fund sentiment before doing days of in-depth research. We do so because hedge funds and other elite investors have numerous Ivy League graduates, expert network advisers, and supply chain tipsters working or consulting for them. There is not a shortage of news stories covering failed hedge fund investments (for some reason media paid a ton of attention to Ackman’s gigantic JC Penney and Valeant failures) and it is a fact that hedge funds’ picks don’t beat the market 100% of the time, but their consensus picks have historically done very well and have outperformed the market after adjusting for risk.
Is Expedia Inc (NASDAQ:EXPE) a bargain? Money managers are becoming hopeful. The number of long hedge fund positions advanced by 8 lately.
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In the eyes of most market participants, hedge funds are viewed as worthless, outdated financial vehicles of years past. While there are more than 8000 funds in operation today, Experts at hedge fund tracking site Insider Monkey look at the leaders of this club, around 700 funds. These money managersmanage bulk of all hedge funds’ total asset base, and by tracking their finest picks, Insider Monkey has brought to light a few investment strategies that have historically defeated the market. Insider Monkey’s small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per annum for a decade in their back tests.
Now, we’re going to check out the new action surrounding Expedia Inc (NASDAQ:EXPE).
What have hedge funds been doing with Expedia Inc (NASDAQ:EXPE)?
At the Q3’s end, a total of 62 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 15% from the second quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were upping their stakes significantly.
According to the hedge fund intelligence website Insider Monkey, Paul Reeder and Edward Shapiro’s PAR Capital Management had the most valuable position in Expedia Inc (NASDAQ:EXPE), worth close to $442.5 million, accounting for 9.3% of its total 13F portfolio. Coming in second is Coatue Management, led by Philippe Laffont, holding a $361.8 million position; the fund has 4.1% of its 13F portfolio invested in the stock. Other members of the smart money that hold long positions comprise Brad Gerstner’s Altimeter Capital Management, Jason Karp’s Tourbillon Capital Partners and Israel Englander’s Millennium Management.
As one would reasonably expect, some big names were breaking ground themselves. Lone Pine Capital, managed by Stephen Mandel, established the most valuable position in Expedia Inc (NASDAQ:EXPE). Lone Pine Capital had 128.8 million invested in the company at the end of the quarter. Robert Pohly’s Samlyn Capital also initiated a $76.3 million position during the quarter. The other funds with new positions in the stock are Gabriel Plotkin’s Melvin Capital Management, Matthew Iorio’s White Elm Capital, and Stanley Druckenmiller’s Duquesne Capital.
Let’s also take a look at hedge fund activity in other stocks similar to Expedia Inc (NASDAQ:EXPE). We will take a look at Altera Corporation (NASDAQ:ALTR), Dr Pepper Snapple Group Inc. (NYSE:DPS), BRF Brasil Foods SA (ADR) (NYSE:BRFS), and Grupo Televisa SAB (ADR) (NYSE:TV). All of these stocks’ market caps are similar to EXPE’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| ALTR | 62 | 3705101 | 0 |
| DPS | 29 | 1710714 | -8 |
| BRFS | 11 | 315092 | -2 |
| TV | 24 | 2001959 | -1 |
With the returns demonstrated by Insider Monkey’s time-tested strategies, retail investors should always monitor hedge fund activity, and Expedia Inc (NASDAQ:EXPE) is an important part of this process.
