To most shareholders, hedge funds are viewed as worthless, outdated financial vehicles of the past. While there are more than 8000 funds trading at present, we look at the aristocrats of this club, close to 450 funds. It is widely believed that this group oversees the majority of the smart money’s total capital, and by watching their top stock picks, we have unearthed a number of investment strategies that have historically outstripped Mr. Market. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per year for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have trumped the S&P 500 index by 23.3 percentage points in 8 months (check out a sample of our picks).
Equally as beneficial, optimistic insider trading activity is a second way to parse down the financial markets. There are lots of stimuli for an insider to cut shares of his or her company, but only one, very simple reason why they would buy. Plenty of empirical studies have demonstrated the market-beating potential of this method if shareholders know what to do (learn more here).
Keeping this in mind, it’s important to take a peek at the latest action regarding Actuant Corporation (NYSE:ATU).
How are hedge funds trading Actuant Corporation (NYSE:ATU)?
Heading into Q2, a total of 13 of the hedge funds we track were long in this stock, a change of 30% from the first quarter. With hedgies’ sentiment swirling, there exists a select group of noteworthy hedge fund managers who were increasing their stakes considerably.
According to our comprehensive database, Brian Bares’s Bares Capital Management had the largest position in Actuant Corporation (NYSE:ATU), worth close to $41.4 million, accounting for 5.3% of its total 13F portfolio. On Bares Capital Management’s heels is Pzena Investment Management, managed by Richard S. Pzena, which held a $35.9 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Other hedge funds that hold long positions include Robert Rodriguez and Steven Romick’s First Pacific Advisors LLC, Boaz Weinstein’s Saba Capital and Ken Griffin’s Citadel Investment Group.
As industrywide interest jumped, key money managers have been driving this bullishness. Bares Capital Management, managed by Brian Bares, established the largest position in Actuant Corporation (NYSE:ATU). Bares Capital Management had 41.4 million invested in the company at the end of the quarter. Robert Rodriguez and Steven Romick’s First Pacific Advisors LLC also initiated a $22.2 million position during the quarter. The other funds with brand new ATU positions are Larry Foley and Paul Farrell’s Bronson Point Partners, Israel Englander’s Millennium Management, and Israel Englander’s Catapult Capital Management.
Insider trading activity in Actuant Corporation (NYSE:ATU)
Insider buying is best served when the company we’re looking at has seen transactions within the past six months. Over the last six-month time period, Actuant Corporation (NYSE:ATU) has seen zero unique insiders buying, and 6 insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to Actuant Corporation (NYSE:ATU). These stocks are Polypore International, Inc. (NYSE:PPO), ITT Corp (NYSE:ITT), Rexnord Corp (NYSE:RXN), Generac Holdings Inc. (NYSE:GNRC), and Zebra Technologies Corp. (NASDAQ:ZBRA). This group of stocks belong to the diversified machinery industry and their market caps resemble ATU’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Polypore International, Inc. (NYSE:PPO) | 12 | 0 | 1 |
| ITT Corp (NYSE:ITT) | 22 | 0 | 6 |
| Rexnord Corp (NYSE:RXN) | 0 | 0 | |
| Generac Holdings Inc. (NYSE:GNRC) | 20 | 0 | 10 |
| Zebra Technologies Corp. (NASDAQ:ZBRA) | 16 | 0 | 7 |
With the returns exhibited by the aforementioned tactics, retail investors must always watch hedge fund and insider trading activity, and Actuant Corporation (NYSE:ATU) applies perfectly to this mantra.
