Republic Airways Holdings Inc. (RJET) Is Ringing Alarm Bells For the Airline Industry

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How have hedgies been trading Republic Airways Holdings Inc. (NASDAQ:RJET)?

At the end of the first quarter, a total of 15 of the hedge funds tracked by Insider Monkey were long in this stock, compared to 23 at the end of the previous quarter. With hedge funds’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were boosting their stakes considerably.

Of the funds tracked by Insider Monkey, Stelliam Investment Management, led by Ross Margolies, holds the number one position in Republic Airways Holdings Inc. (NASDAQ:RJET). Stelliam Investment Management has a $65.3 million position in the stock, comprising 1.5% of its 13F portfolio. On Stelliam Investment Management’s heels is Corsair Capital Management, led by Jay Petschek and Steven Major, which holds a $64 million position; the fund has 6% of its 13F portfolio invested in the stock. Other members of the smart money that are bullish consist of Stephen V. Raneri‘s LionEye Capital Management, Richard L. Haydon’s Yield Capital Partners (Y/Cap Management), and Jim Simons‘ Renaissance Technologies.

Since Republic Airways Holdings Inc. (NASDAQ:RJET) has faced declining sentiment from the smart money, we can see that there lies a certain “tier” of funds that slashed their entire stakes in the first trimester. Intriguingly, Chuck Royce’s Royce & Associates cut the largest investment of all the hedgies followed by Insider Monkey, totaling close to $7.5 million in stock. Richard Driehaus’ fund, Driehaus Capital, also dumped its shares, about $4.2 million worth. These moves are interesting, as total hedge fund interest fell by eight funds in the first quarter.

In light of the new regulations by the Federal Aviation Administration (FAA) and the negative hedge fund sentiment surrounding Republic Airways Holdings Inc. (NASDAQ:RJET), we do not recommend buying the stock at this time.

Disclosure: None

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