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Is LBRDA Stock A Buy or Sell?

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·5 min read
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Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 900 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds' 2018 losses in Facebook and Apple. Let’s take a closer look at what the funds we track think about Liberty Broadband Corp (NASDAQ:LBRDA) in this article.

Is LBRDA stock a buy? Liberty Broadband Corp (NASDAQ:LBRDA) was in 26 hedge funds' portfolios at the end of December. The all time high for this statistic is 29. LBRDA shareholders have witnessed an increase in hedge fund interest in recent months. There were 25 hedge funds in our database with LBRDA positions at the end of the third quarter. Our calculations also showed that LBRDA isn't among the 30 most popular stocks among hedge funds (click for Q4 rankings).


Boykin Curry of Eagle Capital

At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, the CBD market is growing at a 33% annualized rate, so we are taking a closer look at this under-the-radar hemp stock. We go through lists like the 10 best biotech stocks under $10 to identify the next stock with 10x upside potential. 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 website. Keeping this in mind let's review the key hedge fund action surrounding Liberty Broadband Corp (NASDAQ:LBRDA).

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

At fourth quarter's end, a total of 26 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 4% from the previous quarter. By comparison, 24 hedge funds held shares or bullish call options in LBRDA a year ago. With hedgies' positions undergoing their usual ebb and flow, there exists an "upper tier" of notable hedge fund managers who were increasing their holdings substantially (or already accumulated large positions).

More specifically, FPR Partners was the largest shareholder of Liberty Broadband Corp (NASDAQ:LBRDA), with a stake worth $200.5 million reported as of the end of December. Trailing FPR Partners was Ashe Capital, which amassed a stake valued at $154.5 million. Eagle Capital Management, D E Shaw, and Hudson Bay Capital Management were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Freshford Capital Management allocated the biggest weight to Liberty Broadband Corp (NASDAQ:LBRDA), around 10.21% of its 13F portfolio. Ashe Capital is also relatively very bullish on the stock, earmarking 9.66 percent of its 13F equity portfolio to LBRDA.

As aggregate interest increased, specific money managers have jumped into Liberty Broadband Corp (NASDAQ:LBRDA) headfirst. Venator Management LLC, managed by Constantine Mamakos, assembled the biggest position in Liberty Broadband Corp (NASDAQ:LBRDA). Venator Management LLC had $18.6 million invested in the company at the end of the quarter. David Harding's Winton Capital Management also initiated a $0.5 million position during the quarter. The other funds with brand new LBRDA positions are Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital and Paul Tudor Jones's Tudor Investment Corp.

Let's now review hedge fund activity in other stocks - not necessarily in the same industry as Liberty Broadband Corp (NASDAQ:LBRDA) but similarly valued. These stocks are Biogen Inc. (NASDAQ:BIIB), The Trade Desk, Inc. (NASDAQ:TTD), The Bank of New York Mellon Corporation (NYSE:BK), Microchip Technology Incorporated (NASDAQ:MCHP), Cintas Corporation (NASDAQ:CTAS), Chewy, Inc. (NYSE:CHWY), and MSCI Inc (NYSE:MSCI). This group of stocks' market valuations are similar to LBRDA's market valuation.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position BIIB,63,2752928,4 TTD,35,1195309,12 BK,47,4689872,-1 MCHP,45,961474,10 CTAS,36,746276,-2 CHWY,38,728528,-8 MSCI,41,984592,-6 Average,43.6,1722711,1.3 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 43.6 hedge funds with bullish positions and the average amount invested in these stocks was $1723 million. That figure was $909 million in LBRDA's case. Biogen Inc. (NASDAQ:BIIB) is the most popular stock in this table. On the other hand The Trade Desk, Inc. (NASDAQ:TTD) is the least popular one with only 35 bullish hedge fund positions. Compared to these stocks Liberty Broadband Corp (NASDAQ:LBRDA) is even less popular than TTD. Our overall hedge fund sentiment score for LBRDA is 32.9. 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. Hedge funds dodged a bullet by taking a bearish stance towards LBRDA. Our calculations showed that the top 30 most popular hedge fund stocks returned 81.2% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 26 percentage points. These stocks gained 12.3% in 2021 through April 19th but managed to beat the market again by 0.9 percentage points. Unfortunately LBRDA wasn't nearly as popular as these 30 stocks (hedge fund sentiment was very bearish); LBRDA investors were disappointed as the stock returned -4.3% since the end of the fourth quarter (through 4/19) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 30 most popular stocks among hedge funds as most of these stocks already outperformed the market since 2019.

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

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