Legendary investors such as Leon Cooperman and Seth Klarman earn enormous amounts of money for themselves and their investors by doing in-depth research on small-cap stocks that big brokerage houses don’t publish. Small cap stocks -especially when they are screened well- can generate substantial outperformance versus a boring index fund. That’s why we analyze the activity of those elite funds in these small-cap stocks. In the following paragraphs, we analyze GrubHub Inc (NYSE:GRUB) from the perspective of those elite funds.
GrubHub Inc (NYSE:GRUB) shareholders have witnessed an increase in hedge fund interest of late. GRUB was in 29 hedge funds’ portfolios at the end of September. There were 25 hedge funds in our database with GRUB positions at the end of the previous quarter. At the end of this article we will also compare GRUB to other stocks including F.N.B. Corp (NYSE:FNB), Hudson Pacific Properties Inc (NYSE:HPP), and PIMCO Dynamic Credit Income Fund (NYSE:PCI) to get a better sense of its popularity.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
Keeping this in mind, we’re going to view the fresh action regarding GrubHub Inc (NYSE:GRUB).
What does the smart money think about GrubHub Inc (NYSE:GRUB)?
Heading into the fourth quarter of 2016, a total of 29 of the hedge funds tracked by Insider Monkey were bullish on this stock, an increase of 16% from the second quarter of 2016. With the smart money’s sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes meaningfully (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Pelham Capital, managed by Ross Turner, holds the most valuable position in GrubHub Inc (NYSE:GRUB). The fund reportedly has a $247.9 million position in the stock, comprising a massive 91.1% of its 13F portfolio. On Pelham Capital’s heels is PAR Capital Management, managed by Paul Reeder and Edward Shapiro, which holds a $234.5 million stake; 3.4% of its 13F portfolio is allocated to the company. Other professional money managers that are bullish comprise Robert Karr’s Joho Capital, Christian Leone’s Luxor Capital Group and Michael Sidhom’s Immersion Capital.