Is Harman International Industries Inc./DE/ (NYSE:HAR) the right pick for your portfolio? The best stock pickers are reducing their bets on the stock. The number of long hedge fund bets decreased by 3 in recent months.
In the eyes of most stock holders, hedge funds are viewed as underperforming, outdated financial tools of the past. While there are greater than 8000 funds with their doors open at present, we choose to focus on the crème de la crème of this club, close to 450 funds. It is estimated that this group controls the majority of the smart money’s total asset base, and by paying attention to their highest performing investments, we have uncovered a number of investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points a 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 25 percentage points in 6.5 month (explore the details and some picks here).
With these “truths” under our belt, we’re going to take a gander at the latest action surrounding Harman International Industries Inc./DE/ (NYSE:HAR).
What have hedge funds been doing with Harman International Industries Inc./DE/ (NYSE:HAR)?
In preparation for this year, a total of 19 of the hedge funds we track were bullish in this stock, a change of -14% from the previous quarter. With hedgies’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were increasing their stakes substantially.
Of the funds we track, Relational Investors, managed by Ralph V. Whitworth, holds the largest position in Harman International Industries Inc./DE/ (NYSE:HAR). Relational Investors has a $77 million position in the stock, comprising 1.5% of its 13F portfolio. The second largest stake is held by Martin Whitman of Third Avenue Management, with a $49 million position; the fund has 1.1% of its 13F portfolio invested in the stock. Remaining hedgies that hold long positions include Chuck Royce’s Royce & Associates, Cliff Asness’s AQR Capital Management and Daniel Bubis’s Tetrem Capital Management.
Since Harman International Industries Inc./DE/ (NYSE:HAR) has faced falling interest from the entirety of the hedge funds we track, logic holds that there lies a certain “tier” of hedge funds who were dropping their full holdings in Q4. Interestingly, Andrew Sandler’s Sandler Capital Management said goodbye to the biggest stake of the “upper crust” of funds we monitor, totaling close to $8 million in stock., and Neil Chriss of Hutchin Hill Capital was right behind this move, as the fund dumped about $2 million worth. These bearish behaviors are important to note, as total hedge fund interest dropped by 3 funds in Q4.
How have insiders been trading Harman International Industries Inc./DE/ (NYSE:HAR)?
Insider buying is at its handiest when the primary stock in question has experienced transactions within the past half-year. Over the last 180-day time frame, Harman International Industries Inc./DE/ (NYSE:HAR) has experienced zero unique insiders purchasing, and 6 insider sales (see the details of insider trades here).
With the results shown by the aforementioned time-tested strategies, retail investors must always watch hedge fund and insider trading activity, and Harman International Industries Inc./DE/ (NYSE:HAR) is no exception.
Click here to learn more about Insider Monkey’s Hedge Fund Newsletter
Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.
