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Hedge Funds Are Nibbling On Gaming and Leisure Properties Inc (GLPI)

The financial regulations require hedge funds and wealthy investors that exceeded the $100 million equity holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on March 31st, about a week after the S&P 500 Index bottomed. We at Insider Monkey have made an extensive database of more than 821 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded Gaming and Leisure Properties Inc (NASDAQ:GLPI) based on those filings.

Gaming and Leisure Properties Inc (NASDAQ:GLPI) investors should be aware of an increase in hedge fund interest lately. GLPI was in 35 hedge funds’ portfolios at the end of the first quarter of 2020. There were 29 hedge funds in our database with GLPI positions at the end of the previous quarter. Our calculations also showed that GLPI isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks).

Video: Watch our video about the top 5 most popular hedge fund stocks.

In the financial world there are a lot of signals stock market investors can use to assess stocks. Some of the most innovative signals are hedge fund and insider trading interest. We have shown that, historically, those who follow the best picks of the best hedge fund managers can outpace the S&P 500 by a significant amount (see the details here).

Jeffrey Gates Gates Capital

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out trades like this one. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now let’s view the latest hedge fund action encompassing Gaming and Leisure Properties Inc (NASDAQ:GLPI).

How are hedge funds trading Gaming and Leisure Properties Inc (NASDAQ:GLPI)?

At Q1’s end, a total of 35 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 21% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards GLPI over the last 18 quarters. So, let’s check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

Is GLPI A Good Stock To Buy?

More specifically, Renaissance Technologies was the largest shareholder of Gaming and Leisure Properties Inc (NASDAQ:GLPI), with a stake worth $170.2 million reported as of the end of September. Trailing Renaissance Technologies was Gates Capital Management, which amassed a stake valued at $81.4 million. Two Sigma Advisors, Cardinal Capital, and Eminence Capital were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Covalent Capital Partners allocated the biggest weight to Gaming and Leisure Properties Inc (NASDAQ:GLPI), around 16.81% of its 13F portfolio. 1060 Capital Management is also relatively very bullish on the stock, setting aside 13.9 percent of its 13F equity portfolio to GLPI.

As aggregate interest increased, some big names have jumped into Gaming and Leisure Properties Inc (NASDAQ:GLPI) headfirst. Eminence Capital, managed by Ricky Sandler, created the largest position in Gaming and Leisure Properties Inc (NASDAQ:GLPI). Eminence Capital had $29.1 million invested in the company at the end of the quarter. Paul Reeder and Edward Shapiro’s PAR Capital Management also initiated a $14.1 million position during the quarter. The other funds with brand new GLPI positions are Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Jonathan Kolatch’s Redwood Capital Management, and Ed Bosek’s BeaconLight Capital.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Gaming and Leisure Properties Inc (NASDAQ:GLPI) but similarly valued. These stocks are Newell Brands Inc. (NYSE:NWL), Bright Horizons Family Solutions Inc (NYSE:BFAM), Sociedad Quimica y Minera (NYSE:SQM), and Amedisys Inc (NASDAQ:AMED). All of these stocks’ market caps are similar to GLPI’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
NWL 24 1004534 -7
BFAM 27 262204 -7
SQM 10 53846 -3
AMED 20 244124 -2
Average 20.25 391177 -4.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 20.25 hedge funds with bullish positions and the average amount invested in these stocks was $391 million. That figure was $475 million in GLPI’s case. Bright Horizons Family Solutions Inc (NYSE:BFAM) is the most popular stock in this table. On the other hand Sociedad Quimica y Minera (NYSE:SQM) is the least popular one with only 10 bullish hedge fund positions. Compared to these stocks Gaming and Leisure Properties Inc (NASDAQ:GLPI) is more popular among hedge funds. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks returned 8.3% in 2020 through the end of May but still managed to beat the market by 13.2 percentage points. Hedge funds were also right about betting on GLPI as the stock returned 25.2% so far in Q2 (through the end of May) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.

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