We know that hedge funds generate strong, risk-adjusted returns over the long run, therefore imitating the picks that they are collectively bullish on can be a profitable strategy for retail investors. With billions of dollars in assets, smart money investors have to conduct complex analyses, spend many resources and use tools that are not always available for the general crowd. This doesn’t mean that they don’t have occasional colossal losses; they do (like Ackman’s recent Valeant losses). However, it is still good idea to keep an eye on hedge fund activity. With this in mind, as the current round of 13F filings has just ended, let’s examine the smart money sentiment towards Sabra Health Care REIT Inc (NASDAQ:SBRA).
Sabra Health Care REIT Inc (NASDAQ:SBRA) shareholders have witnessed a decrease in hedge fund interest of late. What is quite surprising is that the hedge fund sentiment was similar to that of the market sentiment, as the shares of Sabra Health Care REIT Inc (NASDAQ:SBRA) lost 9.95% value during the quarter. In order to understand the hedge fund behavior, we will find out more about hedgies that had positions in Sabra Health Care REIT Inc (NASDAQ:SBRA), at the end of the last quarter.
At the end of this article we will also compare Sabra Health Care REIT Inc (NASDAQ:SBRA) to other stocks, including Compania de Minas Buenaventura SA (ADR) (NYSE:BVN), Nexstar Broadcasting Group, Inc. (NASDAQ:NXST), and Magellan Health Services Inc (NASDAQ:MGLN) to get a better sense of its popularity.
To most stock holders, hedge funds are assumed to be worthless, old financial tools of yesteryear. While there are over 8000 funds trading at the moment, we look at the top tier of this club, around 700 funds. These investment experts command bulk of all hedge funds’ total capital, and by watching their best investments, Insider Monkey has uncovered a number of investment strategies that have historically exceeded the market. Insider Monkey’s small-cap hedge fund strategy outstripped the S&P 500 index by 12 percentage points per year for a decade in their back tests.
With all of this in mind, let’s take a look at the latest action surrounding Sabra Health Care REIT Inc (NASDAQ:SBRA).
Hedge fund activity in Sabra Health Care REIT Inc (NASDAQ:SBRA)
At the end of the third quarter, a total of 8 of the hedge funds tracked by Insider Monkey were long this stock, a decrease of 33% from the previous quarter. With the smart money’s capital changing hands, there exists a few noteworthy hedge fund managers who were upping their holdings substantially (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, J. Alan Reid, Jr.’s Forward Management has the biggest position in Sabra Health Care REIT Inc (NASDAQ:SBRA), worth close to $37.3 million, amounting to 3% of its total 13F portfolio. The second most bullish fund manager is Highland Capital Management, led by James Dondero, holding a $14.2 million position; the fund has 0.4% of its 13F portfolio invested in the stock. Some other professional money managers that hold long positions comprise Israel Englander’s Millennium Management, Rod Hinze’s KeyPoint Capital Management, and Ken Griffin’s Citadel Investment Group.