Do Hedge Funds and Insiders Love SUPERVALU INC. (SVU)?

Now, according to many of your peers, hedge funds are assumed to be useless, old financial vehicles of a period lost to current times. Although there are more than 8,000 hedge funds with their doors open today, this site aim at the top tier of this group, close to 525 funds. Analysts calculate that this group oversees the lion’s share of the smart money’s total assets, and by keeping an eye on their highest quality equity investments, we’ve determined a number of investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy beat 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 topped the S&P 500 index by 33 percentage points in 11 months (find the details here).

Just as key, positive insider trading sentiment is another way to analyze the investments you’re interested in. There are plenty of incentives for an upper level exec to drop shares of his or her company, but only one, very simple reason why they would initiate a purchase. Many empirical studies have demonstrated the impressive potential of this method if you know what to do (learn more here).

Thus, we’re going to study the newest info for SUPERVALU INC. (NYSE:SVU).

What have hedge funds been doing with SUPERVALU INC. (NYSE:SVU)?

In preparation for the third quarter, a total of 34 of the hedge funds we track held long positions in this stock, a change of 0% from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were boosting their stakes substantially.

When using filings from the hedgies we track, Barry Rosenstein’s JANA Partners had the biggest position in SUPERVALU INC. (NYSE:SVU), worth close to $83 million, comprising 1.2% of its total 13F portfolio. Coming in second is SAC Capital Advisors, managed by Steven Cohen, which held a $47.6 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Some other hedgies that hold long positions include Philippe Laffont’s Coatue Management, Leon Cooperman’s Omega Advisors and SAC Subsidiary’s Sigma Capital Management.

Since SUPERVALU INC. (NYSE:SVU) has experienced bearish sentiment from the entirety of the hedge funds we track, logic holds that there was a specific group of hedgies who were dropping their entire stakes last quarter. Interestingly, Matthew Knauer and Mina Faltas’s Nokota Management dumped the largest stake of all the hedgies we key on, totaling close to $13.4 million in stock, and Boaz Weinstein of Saba Capital was right behind this move, as the fund dumped about $4 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

What do corporate executives and insiders think about SUPERVALU INC. (NYSE:SVU)?

Insider buying made by high-level executives is most useful when the primary stock in question has experienced transactions within the past half-year. Over the latest half-year time frame, SUPERVALU INC. (NYSE:SVU) has seen zero unique insiders purchasing, 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 SUPERVALU INC. (NYSE:SVU). These stocks are The Fresh Market Inc (NASDAQ:TFM), Core-Mark Holding Company, Inc. (NASDAQ:CORE), Village Super Market, Inc. (NASDAQ:VLGEA), Weis Markets, Inc. (NYSE:WMK), and Susser Holdings Corporation (NYSE:SUSS). This group of stocks belong to the grocery stores industry and their market caps are closest to SVU’s market cap.

Using the returns explained by Insider Monkey’s studies, average investors should always watch hedge fund and insider trading activity, and SUPERVALU INC. (NYSE:SVU) shareholders fit into this picture quite nicely.

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