What’s a smart FormFactor, Inc. (NASDAQ:FORM) investor to do?
To the average investor, there are plenty of methods market participants can use to track Mr. Market. A duo of the most under-the-radar are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top investment managers can outperform the market by a superb amount (see just how much).
Equally as useful, bullish insider trading sentiment is another way to look at the stock market universe. Just as you’d expect, there are a variety of reasons for an insider to cut shares of his or her company, but only one, very simple reason why they would buy. Several empirical studies have demonstrated the impressive potential of this strategy if investors know where to look (learn more here).
Furthermore, it’s important to analyze the latest info for FormFactor, Inc. (NASDAQ:FORM).
How are hedge funds trading FormFactor, Inc. (NASDAQ:FORM)?
Heading into Q3, a total of 16 of the hedge funds we track were long in this stock, a change of -11% from the first quarter. With hedgies’ capital changing hands, there exists a few notable hedge fund managers who were upping their holdings substantially.
Out of the hedge funds we follow, Royce & Associates, managed by Chuck Royce, holds the most valuable position in FormFactor, Inc. (NASDAQ:FORM). Royce & Associates has a $9.7 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Coming in second is Renaissance Technologies, managed by Jim Simons, which held a $6.6 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Other hedgies with similar optimism include Cliff Asness’s AQR Capital Management, Steven Cohen’s SAC Capital Advisors and John Zaro’s Bourgeon Capital.
Judging by the fact that FormFactor, Inc. (NASDAQ:FORM) has experienced bearish sentiment from the smart money’s best and brightest, logic holds that there exists a select few money managers that slashed their entire stakes at the end of the second quarter. It’s worth mentioning that Gregory A. Weaver’s Invicta Capital Management sold off the biggest investment of the 450+ funds we track, totaling about $8 million in stock, and Youlia Miteva of Proxima Capital Management was right behind this move, as the fund sold off about $4.3 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest was cut by 2 funds at the end of the second quarter.
What do corporate executives and insiders think about FormFactor, Inc. (NASDAQ:FORM)?
Legal insider trading, particularly when it’s bullish, is most useful when the company we’re looking at has experienced transactions within the past six months. Over the last half-year time frame, FormFactor, Inc. (NASDAQ:FORM) 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 FormFactor, Inc. (NASDAQ:FORM). These stocks are Silicon Image, Inc. (NASDAQ:SIMG), Entropic Communications, Inc. (NASDAQ:ENTR), GSI Technology, Inc. (NASDAQ:GSIT), Inphi Corporation (NYSE:IPHI), and Kopin Corporation (NASDAQ:KOPN). This group of stocks are in the semiconductor – broad line industry and their market caps resemble FORM’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Silicon Image, Inc. (NASDAQ:SIMG) | 15 | 0 | 0 |
| Entropic Communications, Inc. (NASDAQ:ENTR) | 11 | 0 | 0 |
| GSI Technology, Inc. (NASDAQ:GSIT) | 6 | 0 | 0 |
| Inphi Corporation (NYSE:IPHI) | 8 | 0 | 0 |
| Kopin Corporation (NASDAQ:KOPN) | 7 | 0 | 0 |
Using the returns shown by Insider Monkey’s research, regular investors should always pay attention to hedge fund and insider trading activity, and FormFactor, Inc. (NASDAQ:FORM) is an important part of this process.
