Hedge Funds Are Dumping Werner Enterprises, Inc. (WERN)

Is Werner Enterprises, Inc. (NASDAQ:WERN) a buy?

Now, according to many investors, hedge funds are seen as bloated, outdated financial vehicles of an era lost to time. Although there are In excess of 8,000 hedge funds with their doors open currently, Insider Monkey looks at the leaders of this club, close to 525 funds. It is assumed that this group has its hands on the majority of all hedge funds’ total capital, and by keeping an eye on their highest performing picks, we’ve brought to light a number of investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points a 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 outperformed the S&P 500 index by 33 percentage points in 11 months (find the details here).

Just as useful, bullish insider trading activity is a second way to look at the financial markets. There are many incentives for an upper level exec to downsize shares of his or her company, but only one, very clear reason why they would behave bullishly. Many empirical studies have demonstrated the useful potential of this strategy if you understand what to do (learn more here).

Keeping this in mind, we’re going to study the latest info for Werner Enterprises, Inc. (NASDAQ:WERN).

What have hedge funds been doing with Werner Enterprises, Inc. (NASDAQ:WERN)?

In preparation for the third quarter, a total of 9 of the hedge funds we track were long in this stock, a change of -10% from the first quarter. With hedge funds’ sentiment swirling, there exists a few noteworthy hedge fund managers who were upping their stakes substantially.

According to our 13F database, Joel Greenblatt’s Gotham Asset Management had the largest position in Werner Enterprises, Inc. (NASDAQ:WERN), worth close to $7.2 million, accounting for 0.3% of its total 13F portfolio. Sitting at the No. 2 spot is Royce & Associates, managed by Chuck Royce, which held a $7.2 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Other peers that hold long positions include Cliff Asness’s AQR Capital Management, John Overdeck and David Siegel’s Two Sigma Advisors and Israel Englander’s Millennium Management.

Due to the fact Werner Enterprises, Inc. (NASDAQ:WERN) has witnessed dropping sentiment from the top-tier hedge fund industry, it’s safe to say that there lies a certain “tier” of hedge funds who were dropping their full holdings heading into Q2. At the top of the heap, John Fichthorn’s Dialectic Capital Management said goodbye to the largest stake of all the hedgies we key on, worth an estimated $4.4 million in stock, and Ken Gray and Steve Walsh of Bryn Mawr Capital was right behind this move, as the fund said goodbye to about $4.2 million worth. These moves are important to note, as total hedge fund interest dropped by 1 funds heading into Q2.

How are insiders trading Werner Enterprises, Inc. (NASDAQ:WERN)?

Insider buying made by high-level executives is most useful when the primary stock in question has experienced transactions within the past half-year. Over the latest half-year time frame, Werner Enterprises, Inc. (NASDAQ:WERN) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

We’ll also review the relationship between both of these indicators in other stocks similar to Werner Enterprises, Inc. (NASDAQ:WERN). These stocks are Heartland Express, Inc. (NASDAQ:HTLD), Landstar System, Inc. (NASDAQ:LSTR), Knight Transportation (NYSE:KNX), Swift Transportation Co (NYSE:SWFT), and Con-way Inc (NYSE:CNW). This group of stocks are the members of the trucking industry and their market caps are closest to WERN’s market cap.