In the financial world, there are dozens of gauges shareholders can use to track the equity markets. A pair of the most underrated are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite money managers can outperform the market by a healthy margin (see just how much).
Just as useful, bullish insider trading activity is a second way to look at the world of equities. Just as you’d expect, there are many motivations for an upper level exec to cut shares of his or her company, but only one, very obvious reason why they would buy. Plenty of empirical studies have demonstrated the valuable potential of this strategy if piggybackers understand what to do (learn more here).
Now that that’s out of the way, we’re going to study the latest info surrounding Leucadia National Corp. (NYSE:LUK).
What have hedge funds been doing with Leucadia National Corp. (NYSE:LUK)?
In preparation for the third quarter, a total of 30 of the hedge funds we track held long positions in this stock, a change of 11% from the first quarter. With hedgies’ capital changing hands, there exists an “upper tier” of key hedge fund managers who were increasing their stakes substantially.
According to our 13F database, Bruce Berkowitz’s Fairholme (FAIRX) had the biggest position in Leucadia National Corp. (NYSE:LUK), worth close to $489.4 million, accounting for 6.4% of its total 13F portfolio. Sitting at the No. 2 spot is Horizon Asset Management, managed by Murray Stahl, which held a $261 million position; the fund has 3.8% of its 13F portfolio invested in the stock. Other hedgies that hold long positions include Martin Whitman’s Third Avenue Management, Charles Akre’s Akre Capital Management and D. E. Shaw’s D E Shaw.
As aggregate interest spiked, specific money managers were breaking ground themselves. Fairholme (FAIRX), managed by Bruce Berkowitz, created the most outsized position in Leucadia National Corp. (NYSE:LUK). Fairholme (FAIRX) had 489.4 million invested in the company at the end of the quarter. Murray Stahl’s Horizon Asset Management also initiated a $261 million position during the quarter. The other funds with new positions in the stock are Martin Whitman’s Third Avenue Management, Charles Akre’s Akre Capital Management, and D. E. Shaw’s D E Shaw.
How have insiders been trading Leucadia National Corp. (NYSE:LUK)?
Bullish insider trading is particularly usable when the company we’re looking at has seen transactions within the past half-year. Over the latest 180-day time frame, Leucadia National Corp. (NYSE:LUK) has seen 1 unique insiders purchasing, and 2 insider sales (see the details of insider trades here).
We’ll check out the relationship between both of these indicators in other stocks similar to Leucadia National Corp. (NYSE:LUK). These stocks are Pilgrim’s Pride Corporation (NASDAQ:PPC), Seaboard Corporation (NYSEAMEX:SEB), Smithfield Foods, Inc. (NYSE:SFD), Hormel Foods Corporation (NYSE:HRL), and Tyson Foods, Inc. (NYSE:TSN). This group of stocks belong to the meat products industry and their market caps are similar to LUK’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Pilgrim’s Pride Corporation (NASDAQ:PPC) | 20 | 0 | 1 |
| Seaboard Corporation (NYSEAMEX:SEB) | 6 | 0 | 0 |
| Smithfield Foods, Inc. (NYSE:SFD) | 43 | 0 | 1 |
| Hormel Foods Corporation (NYSE:HRL) | 14 | 0 | 1 |
| Tyson Foods, Inc. (NYSE:TSN) | 29 | 2 | 6 |
Using the results demonstrated by the previously mentioned research, average investors should always pay attention to hedge fund and insider trading sentiment, and Leucadia National Corp. (NYSE:LUK) shareholders fit into this picture quite nicely.
