Sally Beauty Holdings, Inc. (SBH): Pennant Capital Management, Blue Ridge Capital, Merchants’ Gate Capital are Bullish

Is Sally Beauty Holdings, Inc. (NYSE:SBH) a bargain? Money managers are taking a bullish view. The number of bullish hedge fund positions moved up by three recently.

Sally Beauty Holdings, Inc. (NYSE:SBH)

As WKRB recently reported, “Sally Beauty Holdings (NYSE:SBH) Director Edward Rabin sold 20,000 shares of the stock on the open market in a transaction dated Wednesday, December 4th. The shares were sold at an average price of $27.80, for a total value of $556,000.00.”

With these “truths” under our belt, it’s important to take a glance at the recent action regarding Sally Beauty Holdings, Inc. (NYSE:SBH).

How have hedgies been trading Sally Beauty Holdings, Inc. (NYSE:SBH)?

At Q3′s end, a total of 31 of the hedge funds Insider Monkey tracks were long in this stock, a change of 11 percent from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their stakes considerably.

According to hedge fund intelligence website Insider Monkey, Alan Fournier’s Pennant Capital Management had the biggest position in Sally Beauty Holdings, Inc. (NYSE:SBH), worth close to $181.3 million, accounting for 3.2 percent of its total 13F portfolio. Coming in second is Blue Ridge Capital, led by John Griffin, holding a $162.7 million position; 1.9 percent of its 13F portfolio is allocated to the stock. Some other hedge funds that are bullish encompass Jason Capello’s Merchants’ Gate Capital, Thomas Steyer’s Farallon Capital and Ken Fisher’s Fisher Asset Management.

As industrywide interest jumped, specific money managers were breaking ground themselves. Tiger Consumer Management, managed by Patrick McCormack, initiated the most outsized position in Sally Beauty Holdings, Inc. (NYSE:SBH). Tiger Consumer Management had 53.1 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $24.1 million position during the quarter. The other funds with new positions in the stock are Israel Englander’s Millennium Management, Greg Poole’s Echo Street Capital Management, and Neil Chriss’s Hutchin Hill Capital.

What do corporate executives and insiders think about Sally Beauty Holdings, Inc. (NYSE:SBH)?

Bullish insider trading is at its handiest when the company in focus has experienced transactions within the past half-year. Over the last six-month time period, Sally Beauty Holdings, Inc. (NYSE:SBH) has seen zero unique insiders buying, and 5 insider sales (see the details of insider trades here).

Let’s also examine hedge fund and insider activity in other stocks similar to Sally Beauty Holdings, Inc. (NYSE:SBH). These stocks are Sothebys (NYSE:BID), Staples, Inc. (NASDAQ:SPLS), HSN, Inc. (NASDAQ:HSNI), Tractor Supply Company (NASDAQ:TSCO), and PetSmart, Inc. (NASDAQ:PETM). This group of stocks are the members of the specialty retail, other industry and their market caps resemble SBH’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Sothebys (NYSE:BID) 35 1 3
Staples, Inc. (NASDAQ:SPLS) 27 0 3
HSN, Inc. (NASDAQ:HSNI) 21 0 4
Tractor Supply Company (NASDAQ:TSCO) 17 0 9
PetSmart, Inc. (NASDAQ:PETM) 18 0 9

Sally Beauty Holdings, Inc. was the third most widely held specialty retail stock at the end of Q3 among the hedge funds Insider Monkey tracks.


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