EnPro Industries, Inc. (NPO): Are Hedge Funds Right About This Stock?

EnPro Industries, Inc. (NYSE:NPO) investors should be aware of an increase in enthusiasm from smart money of late.

In the 21st century investor’s toolkit, there are a multitude of methods market participants can use to watch the equity markets. Two of the most useful are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best money managers can outpace the market by a healthy amount (see just how much).

Equally as important, optimistic insider trading activity is a second way to parse down the stock market universe. As the old adage goes: there are plenty of incentives for an executive to drop shares of his or her company, but only one, very obvious reason why they would buy. Many academic studies have demonstrated the valuable potential of this strategy if piggybackers know where to look (learn more here).

With all of this in mind, it’s important to take a gander at the recent action encompassing EnPro Industries, Inc. (NYSE:NPO).

What have hedge funds been doing with EnPro Industries, Inc. (NYSE:NPO)?

In preparation for this year, a total of 7 of the hedge funds we track were bullish in this stock, a change of 17% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were increasing their holdings substantially.

According to our comprehensive database, Lakewood Capital Management, managed by Anthony Bozza, holds the largest position in EnPro Industries, Inc. (NYSE:NPO). Lakewood Capital Management has a $33.5 million position in the stock, comprising 2.6% of its 13F portfolio. The second largest stake is held by Israel Englander of Millennium Management, with a $9.3 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other peers with similar optimism include Anthony Bozza’s Lakewood Capital Management, Ken Griffin’s Citadel Investment Group and Israel Englander’s Millennium Management.

As one would reasonably expect, key money managers have jumped into EnPro Industries, Inc. (NYSE:NPO) headfirst. Lakewood Capital Management, managed by Anthony Bozza, created the biggest position in EnPro Industries, Inc. (NYSE:NPO). Lakewood Capital Management had 4.3 million invested in the company at the end of the quarter. Cliff Asness’s AQR Capital Management also made a $1.1 million investment in the stock during the quarter. The following funds were also among the new NPO investors: Neil Chriss’s Hutchin Hill Capital and John Overdeck and David Siegel’s Two Sigma Advisors.

What do corporate executives and insiders think about EnPro Industries, Inc. (NYSE:NPO)?

Insider purchases made by high-level executives is most useful when the primary stock in question has seen transactions within the past half-year. Over the last half-year time period, EnPro Industries, Inc. (NYSE:NPO) has seen 3 unique insiders buying, and 2 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to EnPro Industries, Inc. (NYSE:NPO). These stocks are Barnes Group Inc. (NYSE:B), CIRCOR International, Inc. (NYSE:CIR), Sun Hydraulics Corporation (NASDAQ:SNHY), TriMas Corp (NASDAQ:TRS), and Mueller Water Products, Inc. (NYSE:MWA). This group of stocks are the members of the industrial equipment & components industry and their market caps are similar to NPO’s market cap.