Here is What Hedge Funds Think About Tribune Media Co (TRCO)

The worries about the election and the ongoing uncertainty about the path of interest-rate increases have been keeping investors on the sidelines. Of course, most hedge funds and other asset managers have been underperforming main stock market indices since the middle of 2015. Interestingly though, smaller-cap stocks registered their best performance relative to the large-capitalization stocks since the end of the June quarter, suggesting that this may be the best time to take a cue from their stock picks. In fact, the Russell 2000 Index gained more than 15% since the beginning of the third quarter, while the Standard and Poor’s 500 benchmark returned less than 6%. This article will lay out and discuss the hedge fund and institutional investor sentiment towards Tribune Media Co (NYSE:TRCO).

Tribune Media Co (NYSE:TRCO) has experienced an increase in support from the world’s most elite money managers recently. At the end of this article we will also compare TRCO to other stocks including Euronet Worldwide, Inc. (NASDAQ:EEFT), LATAM Airlines Group SA (ADR) (NYSE:LFL), and Alere Inc (NYSE:ALR) to get a better sense of its popularity.

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Keeping this in mind, we’re going to analyze the recent action regarding Tribune Media Co (NYSE:TRCO).

What have hedge funds been doing with Tribune Media Co (NYSE:TRCO)?

Heading into the fourth quarter of 2016, a total of 25 of the hedge funds tracked by Insider Monkey held long positions in this stock, an increase of 9% from the second quarter of 2016. With hedge funds’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings significantly (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Oaktree Capital Management, managed by Howard Marks, holds the biggest position in Tribune Media Co (NYSE:TRCO). The fund has a $517.8 million position in the stock, comprising 6.7% of its 13F portfolio. The second largest stake is held by Angelo Gordon & Co, led by John M. Angelo and Michael L. Gordon, holding a $231.8 million position; the fund has 17.5% of its 13F portfolio invested in the stock. Some other professional money managers that are bullish encompass Mason Hawkins’s Southeastern Asset Management, Leon Cooperman’s Omega Advisors and Steven Tananbaum’s GoldenTree Asset Management.

As industrywide interest jumped, some big names have jumped into Tribune Media Co (NYSE:TRCO) headfirst. OZ Management, managed by Daniel S. Och, established the biggest position in Tribune Media Co (NYSE:TRCO). OZ Management had $6.4 million invested in the company at the end of the quarter. Joel Greenblatt’s Gotham Asset Management also initiated a $2.4 million position during the quarter. The other funds with new positions in the stock are Neil Chriss’s Hutchin Hill Capital, George Hall’s Clinton Group, and Mike Vranos’s Ellington.

Let’s check out hedge fund activity in other stocks similar to Tribune Media Co (NYSE:TRCO). We will take a look at Euronet Worldwide, Inc. (NASDAQ:EEFT), LATAM Airlines Group SA (ADR) (NYSE:LFL), Alere Inc (NYSE:ALR), and Ritchie Bros. Auctioneers (USA) (NYSE:RBA). This group of stocks’ market caps match TRCO’s market cap.

As you can see these stocks had an average of 23 hedge funds with bullish positions and the average amount invested in these stocks was $390 million. That figure was a whooping $1.26 billion in TRCO’s case. Alere Inc (NYSE:ALR) is the most popular stock in this table. On the other hand LATAM Airlines Group SA (ADR) (NYSE:LFL) is the least popular one with only 8 bullish hedge fund positions. Tribune Media Co (NYSE:TRCO) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. In this regard ALR might be a better candidate to consider a long position.

Disclosure: none.