Should You Buy CTC Media, Inc. (CTCM)?

CTC Media, Inc. (NASDAQ:CTCM) was in 14 hedge funds’ portfolio at the end of March. CTCM has experienced an increase in support from the world’s most elite money managers of late. There were 13 hedge funds in our database with CTCM positions at the end of the previous quarter.

If you’d ask most investors, hedge funds are viewed as worthless, old financial vehicles of years past. While there are over 8000 funds trading at the moment, we look at the aristocrats of this club, close to 450 funds. Most estimates calculate that this group controls the majority of the smart money’s total asset base, and by tracking their highest performing stock picks, we have identified a few investment strategies that have historically beaten Mr. Market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have outpaced the S&P 500 index by 23.3 percentage points in 8 months (explore the details and some picks here).

Equally as beneficial, bullish insider trading activity is a second way to break down the marketplace. Just as you’d expect, there are a variety of incentives for a corporate insider to drop shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Several academic studies have demonstrated the valuable potential of this strategy if piggybackers understand where to look (learn more here).

With all of this in mind, we’re going to take a gander at the key action regarding CTC Media, Inc. (NASDAQ:CTCM).

What does the smart money think about CTC Media, Inc. (NASDAQ:CTCM)?

Heading into Q2, a total of 14 of the hedge funds we track held long positions in this stock, a change of 8% from the first quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were increasing their stakes meaningfully.

When looking at the hedgies we track, Renaissance Technologies, managed by Jim Simons, holds the most valuable position in CTC Media, Inc. (NASDAQ:CTCM). Renaissance Technologies has a $7.4 million position in the stock, comprising less than 0.1%% of its 13F portfolio. On Renaissance Technologies’s heels is Citadel Investment Group, managed by Ken Griffin, which held a $6.4 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Remaining peers that are bullish include Glenn Russell Dubin’s Highbridge Capital Management, David Dreman’s Dreman Value Management and Israel Englander’s Millennium Management.

With a general bullishness amongst the heavyweights, key hedge funds were leading the bulls’ herd. Dreman Value Management, managed by David Dreman, assembled the most valuable position in CTC Media, Inc. (NASDAQ:CTCM). Dreman Value Management had 5.1 million invested in the company at the end of the quarter. Paul Marshall and Ian Wace’s Marshall Wace LLP also initiated a $2.3 million position during the quarter. The only other fund with a brand new CTCM position is Steven Cohen’s SAC Capital Advisors.

How have insiders been trading CTC Media, Inc. (NASDAQ:CTCM)?

Bullish insider trading is best served when the company in question has experienced transactions within the past six months. Over the last half-year time period, CTC Media, Inc. (NASDAQ:CTCM) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to CTC Media, Inc. (NASDAQ:CTCM). These stocks are Scripps Networks Interactive, Inc. (NYSE:SNI), Nexstar Broadcasting Group, Inc. (NASDAQ:NXST), LIN TV Corp (NYSE:TVL), Belo Corp. (NYSE:BLC), and Sinclair Broadcast Group, Inc. (NASDAQ:SBGI). All of these stocks are in the broadcasting – tv industry and their market caps resemble CTCM’s market cap.