Hedge Funds Are Buying Analog Devices, Inc. (ADI)

Is Analog Devices, Inc. (NASDAQ:ADI) a buy right now? Prominent investors are turning bullish. The number of bullish hedge fund positions advanced by 4 in recent months.

In the financial world, there are many indicators shareholders can use to monitor Mr. Market. A pair of the best are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite investment managers can trounce their index-focused peers by a healthy margin (see just how much).

Equally as key, bullish insider trading activity is a second way to parse down the world of equities. Obviously, there are a number of reasons for a corporate insider to sell shares of his or her company, but only one, very simple reason why they would initiate a purchase. Plenty of academic studies have demonstrated the impressive potential of this method if you know what to do (learn more here).

Keeping this in mind, let’s take a glance at the key action encompassing Analog Devices, Inc. (NASDAQ:ADI).

What have hedge funds been doing with Analog Devices, Inc. (NASDAQ:ADI)?

At the end of the first quarter, a total of 26 of the hedge funds we track held long positions in this stock, a change of 18% from the first quarter. With hedge funds’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were increasing their stakes meaningfully.

According to our comprehensive database, Cantillon Capital Management, managed by William von Mueffling, holds the most valuable position in Analog Devices, Inc. (NASDAQ:ADI). Cantillon Capital Management has a $310.8 million position in the stock, comprising 9.9% of its 13F portfolio. Coming in second is First Pacific Advisors LLC, managed by Robert Rodriguez and Steven Romick, which held a $170.8 million position; the fund has 1.9% of its 13F portfolio invested in the stock. Other hedgies that are bullish include Jim Simons’s Renaissance Technologies, Panayotis Takis Sparaggis’s Alkeon Capital Management and Dmitry Balyasny’s Balyasny Asset Management.

As industrywide interest jumped, key hedge funds were leading the bulls’ herd. First Pacific Advisors LLC, managed by Robert Rodriguez and Steven Romick, initiated the biggest position in Analog Devices, Inc. (NASDAQ:ADI). First Pacific Advisors LLC had 170.8 million invested in the company at the end of the quarter. Dmitry Balyasny’s Balyasny Asset Management also initiated a $56.3 million position during the quarter. The other funds with new positions in the stock are Matthew Tewksbury’s Stevens Capital Management, Charles Clough’s Clough Capital Partners, and John Overdeck and David Siegel’s Two Sigma Advisors.

How have insiders been trading Analog Devices, Inc. (NASDAQ:ADI)?

Insider buying is at its handiest when the primary stock in question has experienced transactions within the past six months. Over the latest 180-day time frame, Analog Devices, Inc. (NASDAQ:ADI) has experienced zero unique insiders purchasing, and 13 insider sales (see the details of insider trades here).

Let’s check out hedge fund and insider activity in other stocks similar to Analog Devices, Inc. (NASDAQ:ADI). These stocks are IPG Photonics Corporation (NASDAQ:IPGP), Skyworks Solutions Inc (NASDAQ:SWKS), Marvell Technology Group Ltd. (NASDAQ:MRVL), Xilinx, Inc. (NASDAQ:XLNX), and Broadcom Corporation (NASDAQ:BRCM). This group of stocks are the members of the semiconductor – integrated circuits industry and their market caps are closest to ADI’s market cap.