Hedge Funds Are Dumping Nexstar Media Group, Inc. (NXST)

The 800+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the first quarter, which unveil their equity positions as of March 31st. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Nexstar Media Group, Inc. (NASDAQ:NXST).

Nexstar Media Group, Inc. (NASDAQ:NXST) was in 35 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 50. NXST investors should pay attention to a decrease in hedge fund sentiment of late. There were 44 hedge funds in our database with NXST holdings at the end of December. Our calculations also showed that NXST isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).

In the eyes of most market participants, hedge funds are seen as slow, old investment tools of years past. While there are over 8000 funds trading at present, We choose to focus on the upper echelon of this club, about 850 funds. These hedge fund managers control most of the smart money’s total asset base, and by tailing their matchless stock picks, Insider Monkey has formulated several investment strategies that have historically exceeded Mr. Market. Insider Monkey’s flagship short hedge fund strategy outperformed the S&P 500 short ETFs by around 20 percentage points annually since its inception in March 2017. Also, our monthly newsletter’s portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .

Seth Klarman of Baupost Group

Seth Klarman of Baupost Group

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. With all of this in mind we’re going to check out the recent hedge fund action encompassing Nexstar Media Group, Inc. (NASDAQ:NXST).

Do Hedge Funds Think NXST Is A Good Stock To Buy Now?

At first quarter’s end, a total of 35 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -20% from the fourth quarter of 2020. Below, you can check out the change in hedge fund sentiment towards NXST over the last 23 quarters. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Seth Klarman’s Baupost Group has the biggest position in Nexstar Media Group, Inc. (NASDAQ:NXST), worth close to $292.8 million, corresponding to 2.3% of its total 13F portfolio. Coming in second is Cardinal Capital, led by Amy Minella, holding a $163.7 million position; the fund has 4% of its 13F portfolio invested in the stock. Remaining professional money managers that hold long positions comprise Claus Moller’s P2 Capital Partners, Peter S. Park’s Park West Asset Management and Ken Griffin’s Citadel Investment Group. In terms of the portfolio weights assigned to each position Calixto Global Investors allocated the biggest weight to Nexstar Media Group, Inc. (NASDAQ:NXST), around 12.43% of its 13F portfolio. Brightline Capital is also relatively very bullish on the stock, setting aside 7.58 percent of its 13F equity portfolio to NXST.

Seeing as Nexstar Media Group, Inc. (NASDAQ:NXST) has faced a decline in interest from hedge fund managers, we can see that there lies a certain “tier” of fund managers who sold off their full holdings last quarter. At the top of the heap, Randall Smith’s Alden Global Capital said goodbye to the biggest stake of the 750 funds tracked by Insider Monkey, valued at about $19.6 million in stock, and Phill Gross and Robert Atchinson’s Adage Capital Management was right behind this move, as the fund dumped about $19.1 million worth. These transactions are important to note, as total hedge fund interest was cut by 9 funds last quarter.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Nexstar Media Group, Inc. (NASDAQ:NXST) but similarly valued. These stocks are loanDepot, Inc. (NYSE:LDI), Gildan Activewear Inc (NYSE:GIL), Saia Inc (NASDAQ:SAIA), Leggett & Platt, Inc. (NYSE:LEG), Brooks Automation, Inc. (NASDAQ:BRKS), Credit Acceptance Corp. (NASDAQ:CACC), and Alcoa Corporation (NYSE:AA). This group of stocks’ market values are similar to NXST’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
LDI 6 8347 6
GIL 17 643419 0
SAIA 16 420526 0
LEG 24 83229 4
BRKS 25 253750 0
CACC 23 544483 -6
AA 38 1003019 5
Average 21.3 422396 1.3

View table here if you experience formatting issues.

As you can see these stocks had an average of 21.3 hedge funds with bullish positions and the average amount invested in these stocks was $422 million. That figure was $946 million in NXST’s case. Alcoa Corporation (NYSE:AA) is the most popular stock in this table. On the other hand loanDepot, Inc. (NYSE:LDI) is the least popular one with only 6 bullish hedge fund positions. Nexstar Media Group, Inc. (NASDAQ:NXST) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for NXST is 62.3. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 19.3% in 2021 through June 25th and still beat the market by 4.8 percentage points. Hedge funds were also right about betting on NXST, though not to the same extent, as the stock returned 11% since Q1 (through June 25th) and outperformed the market as well.

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Disclosure: None. This article was originally published at Insider Monkey.