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Should You Buy GCI Liberty, Inc. (GLIBA)?

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 Peltz’s recent General Electric losses). However, it is still a 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 GCI Liberty, Inc. (NASDAQ:GLIBA).

GCI Liberty, Inc. (NASDAQ:GLIBA) was in 38 hedge funds’ portfolios at the end of June. GLIBA has seen an increase in hedge fund sentiment lately. There were 36 hedge funds in our database with GLIBA positions at the end of the previous quarter. Our calculations also showed that GLIBA isn’t among the 30 most popular stocks among hedge funds (see the video below).
5 Most Popular Stocks Among Hedge Funds
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.

At the moment there are several gauges shareholders have at their disposal to appraise their stock investments. Some of the most innovative gauges are hedge fund and insider trading activity. We have shown that, historically, those who follow the top picks of the elite money managers can outclass their index-focused peers by a very impressive margin (see the details here).

GLIBA_oct2019

Unlike this former hedge fund manager who is convinced Dow will soar past 40000, our long-short investment strategy doesn’t rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. Let’s take a look at the latest hedge fund action encompassing GCI Liberty, Inc. (NASDAQ:GLIBA).

What have hedge funds been doing with GCI Liberty, Inc. (NASDAQ:GLIBA)?

At Q2’s end, a total of 38 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from the previous quarter. By comparison, 36 hedge funds held shares or bullish call options in GLIBA a year ago. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

01 Mason Hawkins, Southeastern Asset Management

According to Insider Monkey’s hedge fund database, FPR Partners, managed by Bob Peck and Andy Raab, holds the largest position in GCI Liberty, Inc. (NASDAQ:GLIBA). FPR Partners has a $544.8 million position in the stock, comprising 13% of its 13F portfolio. Sitting at the No. 2 spot is Eagle Capital Management, managed by Boykin Curry, which holds a $387.1 million position; the fund has 1.4% of its 13F portfolio invested in the stock. Other peers that are bullish include Mason Hawkins’s Southeastern Asset Management, Sander Gerber’s Hudson Bay Capital Management and Ben Gambill’s Tiger Eye Capital.

As aggregate interest increased, key hedge funds were breaking ground themselves. Fort Baker Capital Management, managed by Steve Pigott, assembled the largest position in GCI Liberty, Inc. (NASDAQ:GLIBA). Fort Baker Capital Management had $10.9 million invested in the company at the end of the quarter. Matthew Tewksbury’s Stevens Capital Management also made a $0.4 million investment in the stock during the quarter. The following funds were also among the new GLIBA investors: David Harding’s Winton Capital Management and Claes Fornell’s CSat Investment Advisory.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as GCI Liberty, Inc. (NASDAQ:GLIBA) but similarly valued. These stocks are Tripadvisor Inc (NASDAQ:TRIP), Ciena Corporation (NYSE:CIEN), Americold Realty Trust (NYSE:COLD), and Commerce Bancshares, Inc. (NASDAQ:CBSH). This group of stocks’ market valuations are similar to GLIBA’s market valuation.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
TRIP 26 1216550 -1
CIEN 36 555109 6
COLD 30 908975 3
CBSH 11 39420 -2
Average 25.75 680014 1.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 25.75 hedge funds with bullish positions and the average amount invested in these stocks was $680 million. That figure was $2030 million in GLIBA’s case. Ciena Corporation (NYSE:CIEN) is the most popular stock in this table. On the other hand Commerce Bancshares, Inc. (NASDAQ:CBSH) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks GCI Liberty, Inc. (NASDAQ:GLIBA) is more popular among hedge funds. Our calculations showed that top 20 most popular stocks among hedge funds returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Unfortunately GLIBA wasn’t nearly as popular as these 20 stocks and hedge funds that were betting on GLIBA were disappointed as the stock returned 1% during the third quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market in Q3.

Disclosure: None. This article was originally published at Insider Monkey.

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