Hedge Funds Are Buying Manitowoc Company, Inc. (MTW)

Manitowoc Company, Inc. (NYSE:MTW) has experienced an increase in enthusiasm from smart money lately.

In the eyes of most traders, hedge funds are seen as worthless, outdated financial vehicles of yesteryear. While there are more than 8000 funds in operation at the moment, we at Insider Monkey look at the crème de la crème of this group, around 450 funds. Most estimates calculate that this group controls the lion’s share of the smart money’s total asset base, and by keeping an eye on their best stock picks, we have determined a few investment strategies that have historically outperformed the market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points per year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have topped the S&P 500 index by 23.3 percentage points in 8 months (check out a sample of our picks).

Just as important, optimistic insider trading activity is another way to break down the world of equities. There are a number of reasons for an executive to sell shares of his or her company, but only one, very clear reason why they would buy. Many academic studies have demonstrated the impressive potential of this method if “monkeys” understand what to do (learn more here).

Keeping this in mind, it’s important to take a look at the latest action encompassing Manitowoc Company, Inc. (NYSE:MTW).

How have hedgies been trading Manitowoc Company, Inc. (NYSE:MTW)?

Heading into Q2, a total of 23 of the hedge funds we track held long positions in this stock, a change of 5% from the first quarter. With hedge funds’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were boosting their stakes significantly.

According to our comprehensive database, James Dinan’s York Capital Management had the most valuable position in Manitowoc Company, Inc. (NYSE:MTW), worth close to $91 million, accounting for 2% of its total 13F portfolio. On York Capital Management’s heels is Sean Cullinan of Point State Capital, with a $44.7 million position; 0.6% of its 13F portfolio is allocated to the stock. Remaining hedge funds that are bullish include Crispin Odey’s Odey Asset Management Group, Daniel Arbess’s Xerion and Donald Chiboucis’s Columbus Circle Investors.

As one would reasonably expect, some big names have been driving this bullishness. Point State Capital, managed by Sean Cullinan, initiated the most outsized position in Manitowoc Company, Inc. (NYSE:MTW). Point State Capital had 44.7 million invested in the company at the end of the quarter. Crispin Odey’s Odey Asset Management Group also made a $33.1 million investment in the stock during the quarter. The other funds with brand new MTW positions are Daniel Arbess’s Xerion, Donald Chiboucis’s Columbus Circle Investors, and George Soros’s Soros Fund Management.

What do corporate executives and insiders think about Manitowoc Company, Inc. (NYSE:MTW)?

Insider trading activity, especially when it’s bullish, is particularly usable when the company in question has seen transactions within the past 180 days. Over the last 180-day time period, Manitowoc Company, Inc. (NYSE:MTW) has experienced zero unique insiders buying, and 7 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Manitowoc Company, Inc. (NYSE:MTW). These stocks are Astec Industries, Inc. (NASDAQ:ASTE), Lindsay Corporation (NYSE:LNN), Joy Global Inc. (NYSE:JOY), AGCO Corporation (NYSE:AGCO), and Terex Corporation (NYSE:TEX). This group of stocks are in the farm & construction machinery industry and their market caps match MTW’s market cap.

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

Click here to learn why you should track hedge funds