J.C. Penney Company, Inc. (JCP), GameStop Corp. (GME): Billionaires Love These Heavily Shorted Stocks

Page 1 of 2

We have identified five stocks that have at least 30% of their outstanding shares shorted, but are also loved by billionaires. The first is J.C. Penney Company, Inc. (NYSE:JCP), which had 24 notable hedge funds – 13F filers – owning the stock as of 3Q, but still has 33% of its outstanding shares shorted. Sales for Penney are expected to be down in FY2013 on the back of reduced traffic and the absence of coupons.

The retailer also expects to see restructuring charges of $1.19 per share in FY2013, with an expected loss per share of $0.85. Penney still trades well below its peers on a P/S basis at 0.3x, versus Kohl’s at 0.5x and Macy’s at 0.6x. This discount is for good reason, though, as analysts do not expect the business to show signs of recovery until FY2014.

Bill Ackman in front of Perishi

We believe that hedge funds are looking beyond J.C. Penney’s interim pressures to what the company can accomplished after its restructuring. Bill Ackman of Pershing Square owns over 39 million J.C. Penney shares – making up over 10% of his 13F portfolio. Other billionaires backing Ackman by owning shares of Penney include Steve Cohen, Israel Englander and Ken Griffin (check out Bill Ackman’s top picks).

GameStop Corp. (NYSE:GME) has over 35% of its shares shorted, but also had 18 notable investors and hedge funds owning the stock as of 3Q. The game retailer has seen pressure from online competitors, which should help push revenues down 7% in FY2013. The interim decline should continue with lower sales of new game hardware and software. Longer-term, the retailer should see a rebound from a move toward digital sales and mobile games. FY2014 revenues are expected to be up by 3% thanks to expected hardware launches. It appears hedge funds are confident that GameStop can pivot effectively enough to avoid drastic sales declines. Another long-term positive is expected margin expansion due to a shift toward digital downloads, if the company can capitalize on this space. Ken Griffin and Steve Cohen are  both big-name investors owning GameStop (check out Ken Griffin’s newest picks).

RadioShack Corporation (NYSE:RSH) saw 16 notable investors and hedge funds – 13F filers – owning the stock as of 3Q and meanwhile had 36% of its shares shorted. RadioShack is expected to continue store closures in the U.S., while opening locations in Mexico. The one upside for the company is its expected growth in mobile computing, which should help boost sales up 1% in 2013. RadioShack was pushed down almost 80% in 2012 as it continues a product shift toward smartphones. The next big milestone for RadioShack is a renegotiation of its Target kiosk. Cohen upped his stake in RadioShack over 1,000% last quarter (check out Steve Cohen’s biggest bets).

Who’s No. 4 and 5?

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

Top 6 Cities For The Ultra Rich to Live in Comfort

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!