Healthways, Inc. (HWAY): Insiders Aren’t Crazy About It

Healthways, Inc. (NASDAQ:HWAY) was in 10 hedge funds’ portfolio at the end of March. HWAY shareholders have witnessed a decrease in hedge fund interest recently. There were 10 hedge funds in our database with HWAY holdings at the end of the previous quarter.

In the 21st century investor’s toolkit, there are plenty of gauges shareholders can use to monitor stocks. Some of the best are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the elite hedge fund managers can outpace their index-focused peers by a healthy margin (see just how much).

Equally as key, optimistic insider trading activity is another way to parse down the stock market universe. Just as you’d expect, there are many incentives for an executive to sell shares of his or her company, but just one, very clear reason why they would behave bullishly. Many academic studies have demonstrated the useful potential of this strategy if shareholders understand what to do (learn more here).

Consequently, we’re going to take a glance at the latest action encompassing Healthways, Inc. (NASDAQ:HWAY).

Hedge fund activity in Healthways, Inc. (NASDAQ:HWAY)

In preparation for this quarter, a total of 10 of the hedge funds we track were long 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 an “upper tier” of key hedge fund managers who were boosting their stakes meaningfully.

When looking at the hedgies we track, Royce & Associates, managed by Chuck Royce, holds the largest position in Healthways, Inc. (NASDAQ:HWAY). Royce & Associates has a $12.5 million position in the stock, comprising less than 0.1%% of its 13F portfolio. The second largest stake is held by Millennium Management, managed by Israel Englander, which held a $5.8 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other hedge funds that hold long positions include James E. Flynn’s Deerfield Management, D. E. Shaw’s D E Shaw and Matthew Hulsizer’s PEAK6 Capital Management.

Due to the fact that Healthways, Inc. (NASDAQ:HWAY) has witnessed declining sentiment from the smart money, it’s easy to see that there exists a select few fund managers that decided to sell off their entire stakes last quarter. At the top of the heap, Christopher Medlock James’s Partner Fund Management dumped the biggest stake of the “upper crust” of funds we monitor, totaling about $3.9 million in stock.. Jason F. Harris’s fund, Kendall Square Capital, also said goodbye to its stock, about $2.9 million worth. These bearish behaviors are interesting, as total hedge fund interest stayed the same (this is a bearish signal in our experience).

How have insiders been trading Healthways, Inc. (NASDAQ:HWAY)?

Insider buying is best served when the company in focus has seen transactions within the past 180 days. Over the last 180-day time period, Healthways, Inc. (NASDAQ:HWAY) has seen zero 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 Healthways, Inc. (NASDAQ:HWAY). These stocks are Acadia Healthcare Company Inc (NASDAQ:ACHC), Hanger Inc (NYSE:HGR), IPC The Hospitalist Company Inc (NASDAQ:IPCM), The Providence Service Corporation (NASDAQ:PRSC), and U.S. Physical Therapy, Inc. (NYSE:USPH). This group of stocks belong to the specialized health services industry and their market caps are closest to HWAY’s market cap.

With the results demonstrated by our studies, retail investors must always monitor hedge fund and insider trading sentiment, and Healthways, Inc. (NASDAQ:HWAY) is an important part of this process.

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