Astec Industries, Inc. (NASDAQ:ASTE) was in 6 hedge funds’ portfolio at the end of December. ASTE investors should pay attention to a decrease in hedge fund sentiment of late. There were 6 hedge funds in our database with ASTE positions at the end of the previous quarter.
According to most shareholders, hedge funds are perceived as worthless, outdated investment vehicles of yesteryear. While there are greater than 8000 funds trading at present, we look at the elite of this club, about 450 funds. It is estimated that this group controls the lion’s share of all hedge funds’ total asset base, and by monitoring their best stock picks, we have revealed a number of investment strategies that have historically outperformed the market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per year for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have beaten the S&P 500 index by 24 percentage points in 7 months (check out a sample of our picks).
Just as integral, bullish insider trading sentiment is another way to break down the stock market universe. Obviously, there are a variety of motivations for a corporate insider to get rid of shares of his or her company, but only one, very clear reason why they would behave bullishly. Plenty of academic studies have demonstrated the valuable potential of this strategy if piggybackers understand where to look (learn more here).
With all of this in mind, we’re going to take a peek at the recent action encompassing Astec Industries, Inc. (NASDAQ:ASTE).
What does the smart money think about Astec Industries, Inc. (NASDAQ:ASTE)?
At year’s end, a total of 6 of the hedge funds we track held long positions in this stock, a change of 0% from the previous quarter. With hedge funds’ capital changing hands, there exists a few noteworthy hedge fund managers who were increasing their stakes significantly.
Of the funds we track, Chuck Royce’s Royce & Associates had the biggest position in Astec Industries, Inc. (NASDAQ:ASTE), worth close to $28.4 million, comprising 0.1% of its total 13F portfolio. On Royce & Associates’s heels is Mario Gabelli of GAMCO Investors, with a $8.1 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining hedgies that hold long positions include Irving Kahn’s Kahn Brothers, Ken Griffin’s Citadel Investment Group and Drew Cupps’s Cupps Capital Management.
Because Astec Industries, Inc. (NASDAQ:ASTE) has faced a declination in interest from the aggregate hedge fund industry, it’s easy to see that there is a sect of money managers that decided to sell off their entire stakes in Q4. At the top of the heap, D. E. Shaw’s D E Shaw dropped the biggest stake of the 450+ funds we monitor, worth an estimated $0.2 million in stock. These bearish behaviors are important to note, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
What do corporate executives and insiders think about Astec Industries, Inc. (NASDAQ:ASTE)?
Bullish insider trading is particularly usable when the company in focus has experienced transactions within the past six months. Over the last 180-day time period, Astec Industries, Inc. (NASDAQ:ASTE) has seen zero unique insiders buying, and 2 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Astec Industries, Inc. (NASDAQ:ASTE). These stocks are NACCO Industries, Inc. (NYSE:NC), Columbus McKinnon Corp. (NASDAQ:CMCO), Alamo Group, Inc. (NYSE:ALG), Lindsay Corporation (NYSE:LNN), and Cascade Corporation (NYSE:CASC). All of these stocks are in the farm & construction machinery industry and their market caps match ASTE’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| NACCO Industries, Inc. (NYSE:NC) | 8 | 0 | 1 |
| Columbus McKinnon Corp. (NASDAQ:CMCO) | 9 | 0 | 0 |
| Alamo Group, Inc. (NYSE:ALG) | 8 | 0 | 4 |
| Lindsay Corporation (NYSE:LNN) | 16 | 0 | 5 |
| Cascade Corporation (NYSE:CASC) | 12 | 0 | 1 |
With the returns demonstrated by the aforementioned strategies, retail investors must always keep an eye on hedge fund and insider trading sentiment, and Astec Industries, Inc. (NASDAQ:ASTE) shareholders fit into this picture quite nicely.
