Before putting in our own effort and resources into finding a good investment, we can quickly utilize hedge fund expertise to give us a quick glimpse of whether that stock could make for a good addition to our portfolios. The odds are not exactly stacked in investors’ favor when it comes to beating the market, as evidenced by the fact that less than 49% of the stocks in the S&P 500 did so during the 12-month period ending October 30. However, 63% of hedge funds’ top 30 stock picks from the index did beat the market, and returned nearly twice as much on average as the index. Thus, we can see that the tireless research and efforts of hedge funds to identify winning stocks can work to our advantage when we know how to use the data. While not all of their picks will be winners, our odds are much better following their best stock picks than trying to go it alone.
Comcast Corporation (NASDAQ:CMCSK) shares haven’t seen a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 27 hedge funds’ portfolios at the end of September. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Novo Nordisk A/S (ADR) (NYSE:NVO), and Intel Corporation (NASDAQ:INTC) to gather more data points.
Now, we’re going to review the fresh action encompassing Comcast Corporation (NASDAQ:CMCSK).
What does the smart money think about Comcast Corporation (NASDAQ:CMCSK)?
At Q3’s end, a total of 27 of the hedge funds tracked by Insider Monkey were bullish on this stock, unchanged from the second quarter. With hedgies’ sentiment swirling, there exists a few noteworthy hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Tom Russo’s Gardner Russo & Gardner has the largest position in Comcast Corporation (NASDAQ:CMCSK), worth close to $232.1 million, corresponding to 2.1% of its total 13F portfolio. Coming in second is Yacktman Asset Management, managed by Donald Yacktman, which holds a $178 million position; 1.2% of its 13F portfolio is allocated to the company. Some other peers that hold long positions include Michael Pausic’s Foxhaven Asset Management, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Mario Gabelli’s GAMCO Investors.
Interestingly, Jim Simons’s Renaissance Technologies dumped the largest stake of the “upper crust” of funds tracked by Insider Monkey, totaling close to $12 million in call options., and John Fichthorn’s Dialectic Capital Management was right behind this move, as the fund said goodbye to about $5.9 million worth.
Let’s go over hedge fund activity in other stocks similar to Comcast Corporation (NASDAQ:CMCSK). These stocks are Novo Nordisk A/S (ADR) (NYSE:NVO), Intel Corporation (NASDAQ:INTC), and International Business Machines Corp. (NYSE:IBM). All of these stocks’ market caps are similar to CMCSK’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
As you can see these stocks had an average of 41.66 hedge funds with bullish positions compared to Comcast’s 27. IBM is the most popular stock in this table with 63 funds long the stock. On the other hand Novo Nordisk A/S (ADR) (NYSE:NVO) is the least popular one with only 17 bullish hedge fund positions. Comcast Corporation (NASDAQ:CMCSK) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard Warren Buffett’s favorite tech stock IBM might be a better candidate to consider a long position.