Is Health Management Associates Inc (NYSE:HMA) ready to rally soon? Money managers are buying. The number of bullish hedge fund bets increased by 3 in recent months. This morning UBS has downgraded its estimates for the Health Management Associates Inc.
At the moment, there are plenty of gauges market participants can use to watch Mr. Market. A pair of the most underrated 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 fund managers can beat the broader indices by a significant margin (see just how much).
Equally as key, optimistic insider trading activity is another way to break down the world of equities. There are many incentives for an insider to sell shares of his or her company, but only one, very clear reason why they would initiate a purchase. Many academic studies have demonstrated the useful potential of this method if “monkeys” know where to look (learn more here).
Consequently, let’s take a peek at the recent action encompassing Health Management Associates Inc (NYSE:HMA).
How are hedge funds trading Health Management Associates Inc (NYSE:HMA)?
At the end of the fourth quarter, a total of 19 of the hedge funds we track were long in this stock, a change of 19% from one quarter earlier. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were upping their stakes considerably.
Of the funds we track, Glenview Capital, managed by Larry Robbins, holds the largest position in Health Management Associates Inc (NYSE:HMA). Glenview Capital has a $326.8 million position in the stock, comprising 4.6% of its 13F portfolio. The second largest stake is held by Charles Clough of Clough Capital Partners, with a $34.6 million position; 1.1% of its 13F portfolio is allocated to the company. Some other hedge funds that hold long positions include Steven Cohen’s SAC Capital Advisors, Gabe Hoffman’s Accipiter Capital Management and Keith Meister’s Corvex Capital.
As aggregate interest increased, some big names were leading the bulls’ herd. Clough Capital Partners, managed by Charles Clough, created the biggest position in Health Management Associates Inc (NYSE:HMA). Clough Capital Partners had 34.6 million invested in the company at the end of the quarter. Keith Meister’s Corvex Capital also initiated a $9.6 million position during the quarter. The following funds were also among the new HMA investors: Jay Venkatesen’s Ayer Capital Management, David Costen Haley’s HBK Investments, and Mark Kingdon’s Kingdon Capital.
How have insiders been trading Health Management Associates Inc (NYSE:HMA)?
Insider purchases made by high-level executives is best served when the company in question has seen transactions within the past half-year. Over the latest half-year time frame, Health Management Associates Inc (NYSE:HMA) has seen 2 unique insiders buying, and 3 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Health Management Associates Inc (NYSE:HMA). These stocks are Select Medical Holdings Corporation (NYSE:SEM), Universal Health Services, Inc. (NYSE:UHS), Tenet Healthcare Corp (NYSE:THC), LifePoint Hospitals, Inc. (NASDAQ:LPNT), and Community Health Systems (NYSE:CYH). This group of stocks are in the hospitals industry and their market caps match HMA’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Select Medical Holdings Corporation (NYSE:SEM) | 11 | 0 | 8 |
| Universal Health Services, Inc. (NYSE:UHS) | 30 | 0 | 7 |
| Tenet Healthcare Corp (NYSE:THC) | 27 | 1 | 6 |
| LifePoint Hospitals, Inc. (NASDAQ:LPNT) | 19 | 0 | 5 |
| Community Health Systems (NYSE:CYH) | 19 | 0 | 10 |
With the results exhibited by our tactics, retail investors should always watch hedge fund and insider trading sentiment, and Health Management Associates Inc (NYSE:HMA) applies perfectly to this mantra.
