Hedge Funds Aren’t Crazy About Discovery Communications Inc. (DISCK) Anymore

Because Discovery Communications Inc. (NASDAQ:DISCK) has faced declining sentiment from the entirety of the hedge funds we track, it’s easy to see that there exists a select few funds who were dropping their full holdings by the end of the third quarter. At the top of the heap, Bart Baum’s Ionic Capital Management said goodbye to the largest position of the “upper crust” of funds tracked by Insider Monkey, worth close to $4.9 million in stock, and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital was right behind this move, as the fund dumped about $3.9 million worth of shares. These transactions are important to note, as total hedge fund interest was cut by 3 funds by the end of the third quarter.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Discovery Communications Inc. (NASDAQ:DISCK) but similarly valued. We will take a look at Celanese Corporation (NYSE:CE), Hologic, Inc. (NASDAQ:HOLX), Philippine Long Distance Telephone (ADR) (NYSE:PHI), and Xerox Corporation (NYSE:XRX). This group of stocks’ market values resemble DISCK’s market value.

As you can see these stocks had an average of 25 hedge funds with bullish positions and the average amount invested in these stocks was $804 million. That figure was $280 million in DISCK’s case. Hologic, Inc. (NASDAQ:HOLX) is the most popular stock in this table. On the other hand Philippine Long Distance Telephone (ADR) (NYSE:PHI) is the least popular one with only 4 bullish hedge fund positions. Discovery Communications Inc. (NASDAQ:DISCK) 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 HOLX might be a better candidate to consider for a long position.

Disclosure: None