Cincinnati Bell Inc. (NYSE:CBB) was in 20 hedge funds’ portfolio at the end of March. CBB investors should pay attention to an increase in support from the world’s most elite money managers in recent months. There were 15 hedge funds in our database with CBB positions at the end of the previous quarter.
To most shareholders, hedge funds are perceived as underperforming, outdated investment tools of years past. While there are over 8000 funds trading at present, we at Insider Monkey look at the elite of this group, close to 450 funds. Most estimates calculate that this group has its hands on the majority of all hedge funds’ total capital, and by monitoring their highest performing investments, we have identified a number of investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points a year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have outperformed the S&P 500 index by 23.3 percentage points in 8 months (explore the details and some picks here).
Just as key, positive insider trading activity is a second way to parse down the financial markets. As the old adage goes: there are many stimuli for an insider to cut shares of his or her company, but only one, very simple reason why they would buy. Several academic studies have demonstrated the impressive potential of this tactic if investors know where to look (learn more here).
Now, it’s important to take a look at the latest action surrounding Cincinnati Bell Inc. (NYSE:CBB).
What have hedge funds been doing with Cincinnati Bell Inc. (NYSE:CBB)?
At Q1’s end, a total of 20 of the hedge funds we track held long positions in this stock, a change of 33% from the previous quarter. With hedgies’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their stakes considerably.
According to our comprehensive database, Mario Gabelli’s GAMCO Investors had the biggest position in Cincinnati Bell Inc. (NYSE:CBB), worth close to $44.9 million, accounting for 0.3% of its total 13F portfolio. Coming in second is Yale M. Fergang and Robert W. Medway of Royal Capital, with a $22.5 million position; 5.5% of its 13F portfolio is allocated to the stock. Remaining peers with similar optimism include Ryan Schaper’s Point Lobos Capital, David Moradi’s Anthion Management and Matthew Knauer and Mina Faltas’s Nokota Management.
Now, key money managers have been driving this bullishness. Point Lobos Capital, managed by Ryan Schaper, assembled the most outsized position in Cincinnati Bell Inc. (NYSE:CBB). Point Lobos Capital had 11.2 million invested in the company at the end of the quarter. David Moradi’s Anthion Management also made a $8.6 million investment in the stock during the quarter. The other funds with new positions in the stock are Matthew Knauer and Mina Faltas’s Nokota Management, Jim Simons’s Renaissance Technologies, and Louis Bacon’s Moore Global Investments.
How are insiders trading Cincinnati Bell Inc. (NYSE:CBB)?
Insider purchases made by high-level executives is most useful when the company we’re looking at has experienced transactions within the past 180 days. Over the last half-year time frame, Cincinnati Bell Inc. (NYSE:CBB) has experienced 2 unique insiders purchasing, and 2 insider sales (see the details of insider trades here).
With the returns demonstrated by our time-tested strategies, everyday investors should always watch hedge fund and insider trading sentiment, and Cincinnati Bell Inc. (NYSE:CBB) applies perfectly to this mantra.