Hedge Funds Adjust Positions on FANG Stocks

Netflix options remain attractively priced

by Josh Selway

Published on May 16, 2018 at 9:28 AM

A number of high-profile investors adjusted their positions on FANG stocks during the first quarter. Below, we'll break down how hedge funds changed their stakes in Facebook Inc (NASDAQ:FB), Amazon.com, Inc. (NASDAQ:AMZN), Alphabet Inc (NASDAQ:GOOGL), and Netflix, Inc. (NASDAQ:NFLX) during the first quarter, as well as how the shares have been performing on the charts.

Starting with social media giant Facebook, Tiger Global Management and Third Point both increased their stakes in the company. Jana Partners, on the other hand, dissolved its FB position. This comes as the company continues to deal with bad actors on its main platform, recently revealing that it deleted hundreds of millions of fake accounts during the first quarter. The stock closed Tuesday at $184.32, making a dramatic comeback after the Cambridge Analytica scandal that pressured it all the way down to $149.02 in late March, thanks in part to some recent blockchain buzz

As for Amazon, George Soros' hedge fund revealed a major stake in the e-commerce giant, buying more than $74 million worth of stock. Meanwhile, the company just announced that Prime members will get a 10% discount on certain items when shopping at Whole Foods. AMZN shares, up almost 65% year-over-year, touched a record high of $1,638.10 back on April 27, and were last seen trading at $1,576.12. In fact, Schaeffer's Quantitative Analyst Chris Prybal notes that Amazon's market cap has increased by more than $213 billion in 2018 -- more than double the jump seen from Microsoft (MSFT), which was second on his list.

Tiger Global Management actually dissolved its position in Google parent Alphabet. GOOGL stock has suffered a series of lower highs in 2018, though it remains slightly higher year-to-date at $1,084.87, and the 200-day moving average has contained pullbacks.

Finally, Tiger increased its Netflix position by 23%, while Soros' fund also boosted its stake in the streaming giant. NFLX stock has had a huge year, up 70% in 2018, and it recorded an all-time high of $338.82 back on April 18. The shares settled at $326.13 on Tuesday. For what it's worth, near-term Netflix options still appear to be attractively priced, based on the Schaeffer's Volatility Index (SVI) of 28%, ranking just 9 percentage points from a 12-month low.

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