Hedge Funds Are Betting On Under Armour Inc (UA)

Under Armour Inc (NYSE:UA) investors should pay attention to an increase in enthusiasm from smart money of late.

To the average investor, there are a multitude of indicators investors can use to track their holdings. A pair of the most under-the-radar are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best investment managers can outperform the S&P 500 by a healthy amount (see just how much).

Just as important, bullish insider trading activity is another way to break down the investments you’re interested in. Just as you’d expect, there are plenty of motivations for a bullish insider to downsize shares of his or her company, but only one, very obvious reason why they would buy. Several empirical studies have demonstrated the impressive potential of this tactic if shareholders know where to look (learn more here).

Keeping this in mind, we’re going to take a look at the recent action regarding Under Armour Inc (NYSE:UA).

How are hedge funds trading Under Armour Inc (NYSE:UA)?

In preparation for this quarter, a total of 20 of the hedge funds we track were long in this stock, a change of 43% from the first quarter. With the smart money’s capital changing hands, there exists a few noteworthy hedge fund managers who were boosting their stakes substantially.

When looking at the hedgies we track, Scopus Asset Management, managed by Alexander Mitchell, holds the largest position in Under Armour Inc (NYSE:UA). Scopus Asset Management has a $103 million position in the stock, comprising 3% of its 13F portfolio. Sitting at the No. 2 spot is Citadel Investment Group, managed by Ken Griffin, which held a $60.4 million position; 0.1% of its 13F portfolio is allocated to the company. Some other hedge funds that hold long positions include Israel Englander’s Millennium Management, Steven Cohen’s SAC Capital Advisors and Jim Simons’s Renaissance Technologies.

Now, key hedge funds were breaking ground themselves. SAC Capital Advisors, managed by Steven Cohen, established the largest position in Under Armour Inc (NYSE:UA). SAC Capital Advisors had 30 million invested in the company at the end of the quarter. Glenn Russell Dubin’s Highbridge Capital Management also made a $18.5 million investment in the stock during the quarter. The other funds with brand new UA positions are SAC Subsidiary’s Sigma Capital Management, Jacob Gottlieb’s Visium Asset Management, and Dmitry Balyasny’s Balyasny Asset Management.

Insider trading activity in Under Armour Inc (NYSE:UA)

Insider buying is at its handiest when the primary stock in question has experienced transactions within the past 180 days. Over the latest half-year time period, Under Armour Inc (NYSE:UA) has seen zero unique insiders buying, and 8 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Under Armour Inc (NYSE:UA). These stocks are Carter’s, Inc. (NYSE:CRI), PVH Corp (NYSE:PVH), Lululemon Athletica inc. (NASDAQ:LULU), Hanesbrands Inc. (NYSE:HBI), and Gildan Activewear Inc (USA) (NYSE:GIL). This group of stocks are in the textile – apparel clothing industry and their market caps resemble UA’s market cap.

With the returns exhibited by the aforementioned strategies, everyday investors should always pay attention to hedge fund and insider trading activity, and Under Armour Inc (NYSE:UA) is an important part of this process.

Click here to learn why you should track hedge funds