Alibaba Group Holding Ltd (BABA) Dives After Revenue Miss, Slower Growth; Hedge Funds Saw This Coming

Hedge fund activity in Alibaba Group Holding Ltd (NYSE:BABA)

By the end of March, 86 of the hedge funds among those we track were long in Alibaba Group Holding Ltd (NYSE:BABA), down from 90 at the end of the previous quarter. There was a slight inflow of capital into the stock, however, as the total value of investments declined by 18.38% quarter-over-quarter, while the stock lost almost 20% of its value in the first three months of the year. It should be noted, however, that only 2.8% of Alibaba’s outstanding stock are owned by hedge funds we follow, an indication that, overall, hedge funds are underweight on Alibaba.

Rob Citrone’s Discovery Capital Management had the largest position in Alibaba Group Holding Ltd (NYSE:BABA) by the end of the first quarter, owning 8.77 million shares worth close to $730.36 million. Meanwhile, Andreas Halvorsen of Viking Global ended the first quarter with 6.94 million Alibaba shares. There were certain hedge funds, however, that were over the glitz brought by Alibaba’s IPO. Dan Loeb’s Third Point, the hedge fund with the largest stake in Alibaba at the end of 2014, said goodbye to all of its 10 million shares worth about $1.04 billion. James Dinan of York Capital Management also dumped 2.81 million shares in the first quarter.

As hedge funds look elsewhere to get more returns for their capital, we also recommend not going long on Alibaba Group Holding Ltd (NYSE:BABA) at the moment.

 Disclosure: None