Ascent Capital Group Inc (ASCMA): Insiders Are Buying, Should You?

Is Ascent Capital Group Inc (NASDAQ:ASCMA) a great stock to buy now? The smart money is selling. The number of bullish hedge fund positions decreased by 3 in recent months.

In the 21st century investor’s toolkit, there are a multitude of indicators investors can use to watch Mr. Market. A duo of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite investment managers can outpace the S&P 500 by a superb amount (see just how much).

Just as important, positive insider trading activity is another way to parse down the stock market universe. Obviously, there are a variety of incentives for a corporate insider to downsize shares of his or her company, but just one, very simple reason why they would initiate a purchase. Many empirical studies have demonstrated the useful potential of this method if “monkeys” know where to look (learn more here).

Keeping this in mind, it’s important to take a gander at the key action surrounding Ascent Capital Group Inc (NASDAQ:ASCMA).

Hedge fund activity in Ascent Capital Group Inc (NASDAQ:ASCMA)

Heading into Q2, a total of 16 of the hedge funds we track held long positions in this stock, a change of -16% from the first quarter. With hedge funds’ sentiment swirling, there exists a few noteworthy hedge fund managers who were boosting their stakes significantly.

According to our comprehensive database, GAMCO Investors, managed by Mario Gabelli, holds the largest position in Ascent Capital Group Inc (NASDAQ:ASCMA). GAMCO Investors has a $84.2 million position in the stock, comprising 0.5% of its 13F portfolio. On GAMCO Investors’s heels is Hound Partners, managed by Jonathan Auerbach, which held a $48.2 million position; 2.8% of its 13F portfolio is allocated to the stock. Other peers with similar optimism include Joel Ramin’s 12 West Capital Management, Jim Simons’s Renaissance Technologies and Manish Chopra’s Tiger Veda.

Since Ascent Capital Group Inc (NASDAQ:ASCMA) has faced bearish sentiment from the entirety of the hedge funds we track, it’s safe to say that there were a few funds that elected to cut their full holdings heading into Q2. Interestingly, Jonathan Auerbach’s Hound Partners cut the largest investment of the 450+ funds we watch, worth about $47.5 million in stock. Scott McLellan’s fund, Marble Arch Investments, also dropped its stock, about $20.2 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest fell by 3 funds heading into Q2.

What do corporate executives and insiders think about Ascent Capital Group Inc (NASDAQ:ASCMA)?

Insider buying is most useful when the company in focus has seen transactions within the past six months. Over the latest half-year time frame, Ascent Capital Group Inc (NASDAQ:ASCMA) has seen 1 unique insiders purchasing, and zero insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Ascent Capital Group Inc (NASDAQ:ASCMA). These stocks are Kratos Defense & Security Solutions, Inc (NASDAQ:KTOS), The Geo Group, Inc. (NYSE:GEO), American Science & Engineering, Inc. (NASDAQ:ASEI), Checkpoint Systems, Inc. (NYSE:CKP), and Brink’S Co (NYSE:BCO). This group of stocks belong to the security & protection services industry and their market caps resemble ASCMA’s market cap.