To many traders, hedge funds are viewed as overrated, old financial tools of a period lost to current times. Although there are In excess of 8,000 hedge funds with their doors open in present day, this site aim at the masters of this club, about 525 funds. It is assumed that this group has its hands on most of the hedge fund industry’s total assets, and by paying attention to their highest quality equity investments, we’ve found a number of investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per annum 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 beaten the S&P 500 index by 33 percentage points in 11 months (explore the details and some picks here).
Just as key, positive insider trading activity is a second way to analyze the marketplace. Just as you’d expect, there are lots of motivations for a bullish insider to downsize shares of his or her company, but just one, very clear reason why they would initiate a purchase. Many academic studies have demonstrated the market-beating potential of this strategy if investors understand what to do (learn more here).
Furthermore, we’re going to discuss the recent info surrounding Lindsay Corporation (NYSE:LNN).
What does the smart money think about Lindsay Corporation (NYSE:LNN)?
In preparation for the third quarter, a total of 16 of the hedge funds we track were long in this stock, a change of -16% from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their stakes considerably.
Out of the hedge funds we follow, Chuck Royce’s Royce & Associates had the largest position in Lindsay Corporation (NYSE:LNN), worth close to $20.1 million, accounting for 0.1% of its total 13F portfolio. Sitting at the No. 2 spot is Ron Gutfleish of Elm Ridge Capital, with a $11.9 million position; 1.4% of its 13F portfolio is allocated to the stock. Some other hedge funds with similar optimism include Mario Gabelli’s GAMCO Investors, Ken Griffin’s Citadel Investment Group and Joel Greenblatt’s Gotham Asset Management.
As Lindsay Corporation (NYSE:LNN) has experienced a fall in interest from upper-tier hedge fund managers, it’s easy to see that there is a sect of money managers that elected to cut their entire stakes at the end of the second quarter. At the top of the heap, Jeffrey Vinik’s Vinik Asset Management sold off the largest stake of the “upper crust” of funds we monitor, comprising close to $17.2 million in stock, and Michael Kaufman of MAK Capital One was right behind this move, as the fund said goodbye to about $9.3 million worth. These transactions are interesting, as total hedge fund interest dropped by 3 funds at the end of the second quarter.
What do corporate executives and insiders think about Lindsay Corporation (NYSE:LNN)?
Insider buying made by high-level executives is at its handiest when the company in focus has experienced transactions within the past half-year. Over the latest six-month time period, Lindsay Corporation (NYSE:LNN) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We’ll go over the relationship between both of these indicators in other stocks similar to Lindsay Corporation (NYSE:LNN). These stocks are Columbus McKinnon Corp. (NASDAQ:CMCO), Alamo Group, Inc. (NYSE:ALG), Manitowoc Company, Inc. (NYSE:MTW), Cascade Corporation (NYSE:CASC), and Astec Industries, Inc. (NASDAQ:ASTE). This group of stocks belong to the farm & construction machinery industry and their market caps resemble LNN’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Columbus McKinnon Corp. (NASDAQ:CMCO) | 10 | 0 | 0 |
| Alamo Group, Inc. (NYSE:ALG) | 7 | 0 | 0 |
| Manitowoc Company, Inc. (NYSE:MTW) | 15 | 0 | 0 |
| Cascade Corporation (NYSE:CASC) | 0 | 0 | |
| Astec Industries, Inc. (NASDAQ:ASTE) | 9 | 0 | 0 |
Using the results shown by the previously mentioned studies, average investors should always pay attention to hedge fund and insider trading sentiment, and Lindsay Corporation (NYSE:LNN) is an important part of this process.
