Is Nexstar Broadcasting Group, Inc. (NXST) A Good Stock To Buy?

Insider Monkey has processed numerous 13F filings of hedge funds and famous investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds and investors’ positions as of the end of the third quarter. You can find write-ups about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves and analyze what the smart money thinks of Nexstar Broadcasting Group, Inc. (NASDAQ:NXST) based on that data.

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Is Nexstar Broadcasting Group, Inc. (NASDAQ:NXST) a good investment right now? The smart money is becoming more confident. The number of bullish hedge fund bets rose by 7 recently. At the end of this article we will also compare NXST to other stocks including Magellan Health Services Inc (NASDAQ:MGLN), Virgin America Inc (NASDAQ:VA), and 2U Inc (NASDAQ:TWOU) to get a better sense of its popularity.

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If you’d ask most shareholders, hedge funds are seen as worthless, outdated financial vehicles of years past. While there are greater than 8000 funds trading today, our hedge fund experts choose to focus on the moguls of this group, approximately 700 funds. These hedge fund managers orchestrate the majority of the smart money’s total capital, and by tracking their highest performing investments, Insider Monkey has come up with a number of investment strategies that have historically outstripped Mr. Market. Insider Monkey’s small-cap hedge fund strategy beat the S&P 500 index by 12 percentage points per annum for a decade in their back tests.

Now, we’re going to take a glance at the recent action encompassing Nexstar Broadcasting Group, Inc. (NASDAQ:NXST).

What does the smart money think about Nexstar Broadcasting Group, Inc. (NASDAQ:NXST)?

Heading into Q4, a total of 34 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 26% from the second quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were boosting their holdings substantially.

According to publicly available hedge fund holdings data compiled by Insider Monkey, MSDC Management, managed by Marc Lisker, Glenn Fuhrman and John Phelan, holds the largest position in Nexstar Broadcasting Group, Inc. (NASDAQ:NXST). MSDC Management has a $143.6 million position in the stock, comprising 4.7% of its 13F portfolio. The second most bullish hedge fund manager is Luxor Capital Group, managed by Christian Leone, which held a $69.7 million position; the fund has 1.6% of its 13F portfolio invested in the stock. Some other hedge funds that are bullish include Daniel Lewis’s Orange Capital, Richard Barrera’s Roystone Capital Partners and Glenn J. Krevlin’s Glenhill Advisors.

Consequently, key money managers have jumped into Nexstar Broadcasting Group, Inc. (NASDAQ:NXST) headfirst. Starboard Value LP, managed by Jeffrey Smith, established the largest call position in Nexstar Broadcasting Group, Inc. (NASDAQ:NXST). Starboard Value LP had $4.7 million invested in the company at the end of the quarter. Peter Muller’s PDT Partners also made a $3.6 million investment in the stock during the quarter. The following funds were also among the new NXST investors: Bart Baum’s Ionic Capital Management, Michael Platt and William Reeves’s BlueCrest Capital Mgmt., and Jim Simons’s Renaissance Technologies.

Let’s check out hedge fund activity in other stocks similar to Nexstar Broadcasting Group, Inc. (NASDAQ:NXST). We will take a look at Magellan Health Services Inc (NASDAQ:MGLN), Virgin America Inc (NASDAQ:VA), 2U Inc (NASDAQ:TWOU), and Mine Safety Appliances (NYSE:MSA). 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
MGLN 18 256703 4
VA 21 586491 9
TWOU 19 95836 6
MSA 19 41255 4

As you can see these stocks had an average of 19.25 hedge funds with bullish positions and the average amount invested in these stocks was $245 million. Virgin America Inc (NASDAQ:VA) is the most popular stock in this table. On the other hand Magellan Health Services Inc (NASDAQ:MGLN) is the least popular one with only 18 bullish hedge fund positions. Compared to these stocks Nexstar Broadcasting Group, Inc. (NASDAQ:NXST) is more popular among hedge funds. Considering that hedge funds are fond of this stock and new hedge funds are buying in, it may be a good idea to analyze it in detail and potentially include it in your portfolio.