Indeed, the world of media has been changing at an extremely high pace in recent years and decades. For instance, spending on media continues to transition from traditional to digital products and services. In fact, analysts and economists anticipate digital spending to account for more than 50% of overall media spend by 2019.
The rapid digital shift, fueled by the growing number of connected consumers and the expansion of mobile telephony, will continue to have a structural effect on almost all media sub-sectors. Hence, media companies need to answer the following question in order to successfully navigate today’s fast-changing landscape: How can we advance through all the noise and attract or retain consumer attention? Given today’s high uncertainty within the media space, investors might find it extremely troublesome to select the appropriate social media stocks for their portfolios. For that reason, Insider Monkey decided to compile a list of social media stocks favored by the hedge funds followed by our team. So let’s have a look at the five most popular social media stocks among the extensive pool of hedge funds tracked by Insider Monkey.
Through extensive research, we determined that imitating some of the picks of hedge funds and other institutional investors can help generate market-beating returns over the long run. The key is to focus on the small-cap picks of these investors, since they are usually less followed by the broader market and are less price-efficient. Our backtests that covered the period between 1999 and 2012, showed that following the 15 most popular small-caps among hedge funds can help a retail investor beat the market by an average of 95 basis points per month (see more details here).
#5. MeetMe Inc. (NASDAQ:MEET)
– Number of Hedge Fund Shareholders (as of June 30): 14
– Total Value of Hedge Funds’ Holdings (as of June 30): $27.73 Million
MeetMe Inc. (NASDAQ:MEET) was a hedge fund “darling” in the second quarter, as the number of funds from our system with long positions in the company spiked to 14 from eight quarter-over-quarter. Similarly, the overall value of those positions rose by an impressive 80% quarter-on-quarter to $27.73 million, primarily due to an almost 88% increase in the value of MeetMe shares. The shares of the location-based social network for meeting new people are up 64% thus far in 2016 despite experiencing a major pullback in mid-August. Just recently, analysts at JMP Securities reiterated their ‘Market Outperform’ rating on the dating site company and the price target of $9, saying that “the recent sell-off in MEET shares is unjustified and we recommend taking advantage of shares at these levels.” Several reports recently criticized the company’s ad model and the activity of MeetMe users, putting strong downward pressure on MeetMe shares. Jim Simons’ Renaissance Technologies LLC upped its position in MeetMe Inc. (NASDAQ:MEET) by 68% during the June quarter to around 762,000 shares.