Baxter International Inc. (NYSE:BAX) shareholders have witnessed a decrease in hedge fund interest in recent months.
In today’s marketplace, there are tons of methods investors can use to watch publicly traded companies. A pair of the most innovative are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top money managers can beat the market by a solid amount (see just how much).
Just as integral, optimistic insider trading activity is a second way to break down the marketplace. There are a number of stimuli for an upper level exec to drop shares of his or her company, but only one, very simple reason why they would behave bullishly. Plenty of empirical studies have demonstrated the market-beating potential of this tactic if shareholders know where to look (learn more here).
With these “truths” under our belt, we’re going to take a look at the recent action regarding Baxter International Inc. (NYSE:BAX).
How have hedgies been trading Baxter International Inc. (NYSE:BAX)?
Heading into 2013, a total of 32 of the hedge funds we track were bullish in this stock, a change of -6% from the previous quarter. With hedge funds’ capital changing hands, there exists a few noteworthy hedge fund managers who were increasing their stakes meaningfully.
Of the funds we track, Iridian Asset Management, managed by David Cohen and Harold Levy, holds the largest position in Baxter International Inc. (NYSE:BAX). Iridian Asset Management has a $245 million billion position in the stock, comprising 4% of its 13F portfolio. Sitting at the No. 2 spot is Ric Dillon of Diamond Hill Capital, with a $125 million position; the fund has 1.4% of its 13F portfolio invested in the stock. Remaining hedgies with similar optimism include Ken Griffin’s Citadel Investment Group, Jean-Marie Eveillard’s First Eagle Investment Management and .
Judging by the fact that Baxter International Inc. (NYSE:BAX) has faced declining sentiment from the smart money, it’s easy to see that there is a sect of funds who sold off their entire stakes at the end of the year. At the top of the heap, Edward Goodnow’s Goodnow Investment Group dropped the biggest stake of all the hedgies we watch, comprising close to $17 million in stock., and Richard Schimel of Diamondback Capital was right behind this move, as the fund sold off about $9 million worth. These moves are interesting, as aggregate hedge fund interest fell by 2 funds at the end of the year.
How have insiders been trading Baxter International Inc. (NYSE:BAX)?
Insider buying is particularly usable when the primary stock in question has experienced transactions within the past six months. Over the last six-month time period, Baxter International Inc. (NYSE:BAX) has seen zero unique insiders purchasing, and 6 insider sales (see the details of insider trades here).
With the returns exhibited by our tactics, retail investors must always monitor hedge fund and insider trading activity, and Baxter International Inc. (NYSE:BAX) is an important part of this process.
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