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Billionaire Christian Leone Boosts Stake in This TV Station Operator, Nelson Peltz Lifts Stake in Struggling Pentair plc. (PNR), Plus 2 Other Moves

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Fresh statistics reveal that the 50 most popular stocks among hedge funds lost 10% in 2015, which practically means that individual investors should have avoided to invest in what hedge funds owned last year. Analysts at Goldman Sachs call this basket of 50 most-owned stocks, “VIP”, which has outperformed the S&P 500 gauge in 64% of all quarters since 2001. One could just look at 2015 as an anomaly, so it does pay off to track what hedge funds own and what moves they carry out. One efficient way of monitoring what hedge funds do is to track their 13G, 13D, and Form 4 filings. These filings usually reveal up-to-date moves and insights about hedge funds’ stances on certain companies, and they seem to be a perfect tool investors could use to mimic hedge funds’ moves. Having said that, the following article will discuss several SEC filings submitted by billionaires Christian Leone, Nelson Peltz, and other hedge fund managers.

At Insider Monkey, we track around 730 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see more details here).

According to a Schedule 13G filing, Christian Leone’s Luxor Capital Group currently owns 1.77 million shares of Nexstar Broadcasting Group Inc. (NASDAQ:NXST), which account for 5.8% of the company’s outstanding common stock. This is up from the stake of 1.11 million shares owned on December 31, as revealed in the fund’s most recent 13F. On January 27, TV station operator Nextstar Broadcasting announced that it had agreed to purchase Media General Inc. (NYSE:MEG) in a cash-and-stock deal. Under the terms of the deal, Media General shareholders will receive $10.55 in cash and 0.1249 of a share of Nexstar Class A common stock for each share of Media General owned. The combined company will be one of the nation’s largest local TV station operators with 171 stations across the country. Nexstar Broadcasting Group Inc. (NASDAQ:NXST) intends to divest some TV stations to obtain FCC approval, while the deal is anticipated to close by the end of the third quarter or at the beginning of the fourth quarter of this year. Media General Inc. (NYSE:MEG) initially intended to merge with Meredith Corporation (NYSE:MDP), which recently withdrew its agreement in exchange for a $60 million breakup payment. Meanwhile, Nexstar shares are 30% in the red year-to-date and trade at a forward P/E of only 9.34, which is below the average of 15.75 for the S&P 500 Index. A total of 34 hedge funds tracked by Insider Monkey were invested in the TV station operator at the end of December 2015, amassing 36% of its outstanding stock. Daniel Lewis’ Orange Capital upped its stake in Nexstar Broadcasting Group Inc. (NASDAQ:NXST) by 14% during the December quarter to 1.20 million shares.

Christian Leone
Christian Leone
Luxor Capital Group

Let’s head to the next two pages of this article, where we discuss three other SEC filings submitted by several widely-known hedge fund managers.

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