Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track more than 700 prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile gigantic failures like hedge funds’ recent losses in Valeant. Let’s take a closer look at what the funds we track think about Scripps Networks Interactive, Inc. (NYSE:SNI) in this article.
Scripps Networks Interactive, Inc. (NYSE:SNI) investors should pay attention to an increase in activity from the world’s largest hedge funds of late, witnessing a net increase of 2 hedge fund shareholders in Q3. At the end of this article we will also compare SNI to other stocks including Darden Restaurants, Inc. (NYSE:DRI), Garmin Ltd. (NASDAQ:GRMN), and Crescent Point Energy Corp (NYSE:CPG) to get a better sense of its popularity.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
What have hedge funds been doing with Scripps Networks Interactive, Inc. (NYSE:SNI)?
Heading into the fourth quarter of 2016, a total of 23 of the hedge funds tracked by Insider Monkey were long this stock, a boost of 10% from the second quarter of 2016, returning ownership of the stock among hedgies back to where it was two quarters earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were boosting their holdings meaningfully (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Mason Hawkins’ Southeastern Asset Management has the number one position in Scripps Networks Interactive, Inc. (NYSE:SNI), worth close to $677.2 million, amounting to 6.5% of its total 13F portfolio. The second largest stake is held by Gardner Russo & Gardner, led by Tom Russo, holding a $74.8 million position. Remaining professional money managers that hold long positions contain Mario Gabelli’s GAMCO Investors, David Harding’s Winton Capital Management and Andrew Sandler’s Sandler Capital Management.
With general bullishness amongst the heavyweights, specific money managers were breaking ground themselves. Sandler Capital Management created the most valuable call position in Scripps Networks Interactive, Inc. (NYSE:SNI). Sandler Capital Management had $39.5 million invested in the company at the end of the quarter. Phill Gross and Robert Atchinson’s Adage Capital Management also initiated a $12.5 million position during the quarter. The other funds with brand new SNI positions are Chuck Royce’s Royce & Associates, Matthew Hulsizer’s PEAK6 Capital Management, and Ken Griffin’s Citadel Investment Group.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Scripps Networks Interactive, Inc. (NYSE:SNI) but similarly valued. We will take a look at Darden Restaurants, Inc. (NYSE:DRI), Garmin Ltd. (NASDAQ:GRMN), Crescent Point Energy Corp (NYSE:CPG), and ANSYS, Inc. (NASDAQ:ANSS). This group of stocks’ market values match SNI’s market value.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
As you can see these stocks had an average of 23.5 hedge funds with bullish positions and the average amount invested in these stocks was $343 million. That figure was $1.00 billion in SNI’s case. Darden Restaurants, Inc. (NYSE:DRI) is the most popular stock in this table. On the other hand Crescent Point Energy Corp (NYSE:CPG) is the least popular one with only 16 bullish hedge fund positions. Scripps Networks Interactive, Inc. (NYSE:SNI) is not the least popular stock in this group but hedge fund interest is still below average, though it does have more money invested in it than any other stock. Nonetheless, we’d rather spend our time researching stocks that hedge funds are piling on. In this regard DRI might be a better candidate to consider a long position in.