Was The Smart Money Right About Live Nation Entertainment, Inc. (LYV)?

The 800+ hedge funds and famous money managers tracked by Insider Monkey have already compiled and submitted their 13F filings for the second quarter, which unveil their equity positions as of June 30th. We went through these filings, fixed typos and other more significant errors and identified the changes in hedge fund portfolios. Our extensive review of these public filings is finally over, so this article is set to reveal the smart money sentiment towards Live Nation Entertainment, Inc. (NYSE:LYV).

Live Nation Entertainment, Inc. (NYSE:LYV) investors should be aware of an increase in hedge fund interest of late. Live Nation Entertainment, Inc. (NYSE:LYV) was in 40 hedge funds’ portfolios at the end of June. The all time high for this statistic is 50. There were 37 hedge funds in our database with LYV holdings at the end of March. Our calculations also showed that LYV isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).

In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s monthly stock picks returned 185.4% since March 2017 and outperformed the S&P 500 ETFs by more than 79 percentage points (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Keeping this in mind let’s analyze the key hedge fund action surrounding Live Nation Entertainment, Inc. (NYSE:LYV).

Do Hedge Funds Think LYV Is A Good Stock To Buy Now?

At the end of June, a total of 40 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 8% from one quarter earlier. On the other hand, there were a total of 44 hedge funds with a bullish position in LYV a year ago. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were adding to their holdings considerably (or already accumulated large positions).

The largest stake in Live Nation Entertainment, Inc. (NYSE:LYV) was held by Select Equity Group, which reported holding $264.1 million worth of stock at the end of June. It was followed by Melvin Capital Management with a $227.7 million position. Other investors bullish on the company included Citadel Investment Group, Horizon Asset Management, and Emerson Point Capital. In terms of the portfolio weights assigned to each position Emerson Point Capital allocated the biggest weight to Live Nation Entertainment, Inc. (NYSE:LYV), around 7.69% of its 13F portfolio. Columbus Point is also relatively very bullish on the stock, setting aside 2.78 percent of its 13F equity portfolio to LYV.

Consequently, key money managers have been driving this bullishness. JS Capital, managed by Jonathan Soros, established the most outsized position in Live Nation Entertainment, Inc. (NYSE:LYV). JS Capital had $39.7 million invested in the company at the end of the quarter. Gabriel Plotkin’s Melvin Capital Management also made a $26.3 million investment in the stock during the quarter. The following funds were also among the new LYV investors: Cliff Asness’s AQR Capital Management, Canhui Ou’s One01 Capital, and Jordan Moelis and Jeff Farroni’s Deep Field Asset Management.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Live Nation Entertainment, Inc. (NYSE:LYV) but similarly valued. We will take a look at Darden Restaurants, Inc. (NYSE:DRI), Smith & Nephew plc (NYSE:SNN), Hewlett Packard Enterprise Company (NYSE:HPE), Akamai Technologies, Inc. (NASDAQ:AKAM), Ulta Beauty, Inc. (NASDAQ:ULTA), HEICO Corporation (NYSE:HEI), and Insulet Corporation (NASDAQ:PODD). This group of stocks’ market caps are similar to LYV’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 34.3 hedge funds with bullish positions and the average amount invested in these stocks was $800 million. That figure was $882 million in LYV’s case. Darden Restaurants, Inc. (NYSE:DRI) is the most popular stock in this table. On the other hand Smith & Nephew plc (NYSE:SNN) is the least popular one with only 13 bullish hedge fund positions. Live Nation Entertainment, Inc. (NYSE:LYV) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for LYV is 75.5. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 29.6% in 2021 through November 5th and still beat the market by 3.1 percentage points. Hedge funds were also right about betting on LYV as the stock returned 41.3% since the end of Q2 (through 11/5) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

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