Crane Co. (CR): Hedge Funds Are Bullish and Insiders Are Bearish, What Should You Do?

Crane Co. (NYSE:CR) investors should pay attention to an increase in enthusiasm from smart money of late.

At the moment, there are tons of gauges market participants can use to analyze the equity markets. A duo of the most useful are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best hedge fund managers can outperform the market by a healthy amount (see just how much).

Just as key, optimistic insider trading sentiment is another way to parse down the world of equities. As the old adage goes: there are a number of reasons for an upper level exec to drop shares of his or her company, but just one, very simple reason why they would initiate a purchase. Various academic studies have demonstrated the impressive potential of this tactic if you know what to do (learn more here).

With these “truths” under our belt, it’s important to take a glance at the key action surrounding Crane Co. (NYSE:CR).

How are hedge funds trading Crane Co. (NYSE:CR)?

At the end of the first quarter, a total of 25 of the hedge funds we track were long in this stock, a change of 25% from the first quarter. With hedge funds’ capital changing hands, there exists a few key hedge fund managers who were increasing their stakes significantly.

When looking at the hedgies we track, GAMCO Investors, managed by Mario Gabelli, holds the biggest position in Crane Co. (NYSE:CR). GAMCO Investors has a $204.5 million position in the stock, comprising 1.3% of its 13F portfolio. The second largest stake is held by SAC Capital Advisors, managed by Steven Cohen, which held a $66.3 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Other peers that are bullish include David Dreman’s Dreman Value Management, Cliff Asness’s AQR Capital Management and Chuck Royce’s Royce & Associates.

With a general bullishness amongst the heavyweights, specific money managers have jumped into Crane Co. (NYSE:CR) headfirst. Adage Capital Management, managed by Phill Gross and Robert Atchinson, assembled the biggest position in Crane Co. (NYSE:CR). Adage Capital Management had 12.5 million invested in the company at the end of the quarter. Jim Simons’s Renaissance Technologies also made a $3.7 million investment in the stock during the quarter. The other funds with brand new CR positions are Neil Chriss’s Hutchin Hill Capital, Israel Englander’s Catapult Capital Management, and Mike Vranos’s Ellington.

How have insiders been trading Crane Co. (NYSE:CR)?

Bullish insider trading is most useful when the company in focus has experienced transactions within the past 180 days. Over the latest half-year time frame, Crane Co. (NYSE:CR) has seen zero unique insiders purchasing, and 9 insider sales (see the details of insider trades here).

Let’s also examine hedge fund and insider activity in other stocks similar to Crane Co. (NYSE:CR). These stocks are The Middleby Corporation (NASDAQ:MIDD), Graco Inc. (NYSE:GGG), 3D Systems Corporation (NYSE:DDD), Lennox International Inc. (NYSE:LII), and Babcock & Wilcox Co (NYSE:BWC). All of these stocks are in the diversified machinery industry and their market caps are closest to CR’s market cap.