Is Fastenal Company (NASDAQ:FAST) a buy here? Hedge funds are taking a bearish view. The number of long hedge fund positions retreated by 3 in recent months.
In today’s marketplace, there are a multitude of metrics investors can use to track the equity markets. Some of the most under-the-radar are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the elite fund managers can beat the broader indices by a significant margin (see just how much).
Equally as beneficial, optimistic insider trading activity is a second way to break down the world of equities. Just as you’d expect, there are plenty of incentives for an executive to sell shares of his or her company, but just one, very obvious reason why they would buy. Many empirical studies have demonstrated the market-beating potential of this tactic if investors know what to do (learn more here).
Keeping this in mind, we’re going to take a gander at the latest action surrounding Fastenal Company (NASDAQ:FAST).
How are hedge funds trading Fastenal Company (NASDAQ:FAST)?
Heading into Q2, a total of 15 of the hedge funds we track were long in this stock, a change of -17% from the previous quarter. With hedge funds’ capital changing hands, there exists a few key hedge fund managers who were upping their stakes considerably.
According to our comprehensive database, Steven Cohen’s SAC Capital Advisors had the biggest position in Fastenal Company (NASDAQ:FAST), worth close to $69.1 million, comprising 0.3% of its total 13F portfolio. The second largest stake is held by Conatus Capital Management, managed by David Stemerman, which held a $50.9 million position; 2.2% of its 13F portfolio is allocated to the company. Some other peers that are bullish include Matthew Hulsizer’s PEAK6 Capital Management, James Dondero’s Highland Capital Management and Phill Gross and Robert Atchinson’s Adage Capital Management.
Since Fastenal Company (NASDAQ:FAST) has witnessed declining sentiment from the smart money, it’s safe to say that there is a sect of money managers that decided to sell off their entire stakes in Q1. Interestingly, Dmitry Balyasny’s Balyasny Asset Management sold off the biggest investment of the “upper crust” of funds we watch, comprising close to $7 million in stock., and Bart Baum of Ionic Capital Management was right behind this move, as the fund dumped about $4.8 million worth. These transactions are important to note, as aggregate hedge fund interest dropped by 3 funds in Q1.
How are insiders trading Fastenal Company (NASDAQ:FAST)?
Insider buying is most useful when the primary stock in question has seen transactions within the past half-year. Over the last half-year time period, Fastenal Company (NASDAQ:FAST) has experienced 5 unique insiders purchasing, and 4 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Fastenal Company (NASDAQ:FAST). These stocks are Armstrong World Industries, Inc. (NYSE:AWI), Martin Marietta Materials, Inc. (NYSE:MLM), Owens Corning (NYSE:OC), Vulcan Materials Company (NYSE:VMC), and Masco Corporation (NYSE:MAS). This group of stocks belong to the general building materials industry and their market caps are similar to FAST’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Armstrong World Industries, Inc. (NYSE:AWI) | 20 | 0 | 4 |
| Martin Marietta Materials, Inc. (NYSE:MLM) | 25 | 0 | 9 |
| Owens Corning (NYSE:OC) | 47 | 0 | 5 |
| Vulcan Materials Company (NYSE:VMC) | 17 | 0 | 2 |
| Masco Corporation (NYSE:MAS) | 30 | 2 | 7 |
With the results demonstrated by our studies, everyday investors must always keep an eye on hedge fund and insider trading sentiment, and Fastenal Company (NASDAQ:FAST) is no exception.
