Belo Corp. (NYSE:BLC) investors should be aware of a decrease in support from the world’s most elite money managers lately.
In the eyes of most market participants, hedge funds are assumed to be underperforming, old financial vehicles of years past. While there are greater than 8000 funds in operation at present, we at Insider Monkey choose to focus on the bigwigs of this group, close to 450 funds. It is widely believed that this group has its hands on the lion’s share of the hedge fund industry’s total capital, and by keeping an eye on their best picks, we have unearthed a few investment strategies that have historically outstripped Mr. Market. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have beaten the S&P 500 index by 23.3 percentage points in 8 months (see all of our picks from August).
Equally as important, positive insider trading sentiment is another way to break down the world of equities. Just as you’d expect, there are plenty of motivations for a corporate insider to drop shares of his or her company, but only one, very simple reason why they would buy. Many academic studies have demonstrated the market-beating potential of this strategy if “monkeys” understand what to do (learn more here).
Now, let’s take a gander at the latest action surrounding Belo Corp. (NYSE:BLC).
Hedge fund activity in Belo Corp. (NYSE:BLC)
In preparation for this quarter, a total of 16 of the hedge funds we track were long in this stock, a change of -16% from the previous quarter. With hedge funds’ sentiment swirling, there exists a few noteworthy hedge fund managers who were increasing their holdings substantially.
When looking at the hedgies we track, Chuck Royce’s Royce & Associates had the biggest position in Belo Corp. (NYSE:BLC), worth close to $35 million, accounting for 0.1% of its total 13F portfolio. On Royce & Associates’s heels is Joshua Friedman and Mitchell Julis of Canyon Capital Advisors, with a $24.6 million position; 4.1% of its 13F portfolio is allocated to the stock. Remaining hedge funds that hold long positions include Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Phill Gross and Robert Atchinson’s Adage Capital Management and Mario Gabelli’s GAMCO Investors.
Judging by the fact that Belo Corp. (NYSE:BLC) has experienced a declination in interest from the smart money, it’s safe to say that there was a specific group of money managers who sold off their positions entirely heading into Q2. Intriguingly, Howard Guberman’s Gruss Asset Management dumped the biggest position of the 450+ funds we key on, comprising close to $4 million in stock., and Boaz Weinstein of Saba Capital was right behind this move, as the fund dumped about $2.3 million worth. These transactions are important to note, as aggregate hedge fund interest fell by 3 funds heading into Q2.
What have insiders been doing with Belo Corp. (NYSE:BLC)?
Bullish insider trading is most useful when the company in question has experienced transactions within the past six months. Over the last half-year time period, Belo Corp. (NYSE:BLC) has seen zero unique insiders buying, and 4 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Belo Corp. (NYSE:BLC). These stocks are Fisher Communications, Inc. (NASDAQ:FSCI), CTC Media, Inc. (NASDAQ:CTCM), Nexstar Broadcasting Group, Inc. (NASDAQ:NXST), Sinclair Broadcast Group, Inc. (NASDAQ:SBGI), and LIN TV Corp (NYSE:TVL). This group of stocks belong to the broadcasting – tv industry and their market caps are similar to BLC’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Fisher Communications, Inc. (NASDAQ:FSCI)||8||4||2|
|CTC Media, Inc. (NASDAQ:CTCM)||14||0||0|
|Nexstar Broadcasting Group, Inc. (NASDAQ:NXST)||21||1||9|
|Sinclair Broadcast Group, Inc. (NASDAQ:SBGI)||20||0||8|
|LIN TV Corp (NYSE:TVL)||11||0||6|
With the returns demonstrated by Insider Monkey’s time-tested strategies, everyday investors should always watch hedge fund and insider trading activity, and Belo Corp. (NYSE:BLC) applies perfectly to this mantra.