Hedge Funds Aren’t Crazy About Ann Inc (ANN) Anymore

At the moment, there are dozens of indicators market participants can use to monitor Mr. Market. A duo of the most useful are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top money managers can outclass the broader indices by a significant margin (see just how much).

Just as crucial, bullish insider trading sentiment is another way to look at the financial markets. There are a number of stimuli for a corporate insider to drop shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Various empirical studies have demonstrated the impressive potential of this strategy if investors understand what to do (learn more here).

Keeping this in mind, let’s study the newest info for Ann Inc (NYSE:ANN).

How have hedgies been trading Ann Inc (NYSE:ANN)?

At Q2’s end, a total of 17 of the hedge funds we track were long in this stock, a change of -11% from the previous quarter. With the smart money’s capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes considerably.

According to our 13F database, Eminence Capital, managed by Ricky Sandler, holds the biggest position in Ann Inc (NYSE:ANN). Eminence Capital has a $54.1 million position in the stock, comprising 1.3% of its 13F portfolio. Sitting at the No. 2 spot is Citadel Investment Group, managed by Ken Griffin, which held a $52.7 million position; 0.1% of its 13F portfolio is allocated to the stock. Other hedge funds that hold long positions include Jim Simons’s Renaissance Technologies, Clint Carlson’s Carlson Capital and Steven Cohen’s SAC Capital Advisors.

Judging by the fact that Ann Inc (NYSE:ANN) has faced dropping sentiment from the top-tier hedge fund industry, we can see that there were a few hedge funds who sold off their full holdings in Q1. At the top of the heap, Brett Barakett’s Tremblant Capital sold off the largest investment of the 450+ funds we track, worth close to $25.7 million in stock. John Overdeck and David Siegel’s fund, Two Sigma Advisors, also sold off its stock, about $2.3 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest was cut by 2 funds in Q1.

Insider trading activity in Ann Inc (NYSE:ANN)

Legal insider trading, particularly when it’s bullish, is at its handiest when the company in question has experienced transactions within the past six months. Over the latest half-year time period, Ann Inc (NYSE:ANN) has seen 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 Ann Inc (NYSE:ANN). These stocks are The Men’s Wearhouse, Inc. (NYSE:MW), Jos. A. Bank Clothiers Inc (NASDAQ:JOSB), Wacoal Holdings Corporation (ADR) (NASDAQ:WACLY), Express, Inc. (NYSE:EXPR), and Genesco Inc. (NYSE:GCO). All of these stocks are in the apparel stores industry and their market caps are closest to ANN’s market cap.

Using the returns explained by the previously mentioned analyses, average investors must always watch hedge fund and insider trading activity, and Ann Inc (NYSE:ANN) shareholders fit into this picture quite nicely.

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