Is Strayer Education Inc (NASDAQ:STRA) a buy, sell, or hold? The best stock pickers are selling. The number of long hedge fund bets retreated by 1 in recent months.
If you’d ask most stock holders, hedge funds are assumed to be unimportant, outdated investment vehicles of yesteryear. While there are greater than 8000 funds with their doors open today, we at Insider Monkey choose to focus on the moguls of this group, around 450 funds. Most estimates calculate that this group controls the majority of the smart money’s total capital, and by watching their highest performing investments, we have identified a number of investment strategies that have historically outperformed the S&P 500 index. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per 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 trumped the S&P 500 index by 24 percentage points in 7 months (explore the details and some picks here).
Equally as key, optimistic insider trading sentiment is another way to parse down the financial markets. Just as you’d expect, there are a number of motivations for an upper level exec to drop shares of his or her company, but just one, very clear reason why they would behave bullishly. Many academic studies have demonstrated the useful potential of this strategy if piggybackers understand where to look (learn more here).
With these “truths” under our belt, we’re going to take a look at the key action encompassing Strayer Education Inc (NASDAQ:STRA).
What does the smart money think about Strayer Education Inc (NASDAQ:STRA)?
At year’s end, a total of 7 of the hedge funds we track were bullish in this stock, a change of -13% from the third quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were increasing their holdings meaningfully.
Of the funds we track, Chuck Royce’s Royce & Associates had the largest position in Strayer Education Inc (NASDAQ:STRA), worth close to $66.2 million, accounting for 0.2% of its total 13F portfolio. The second largest stake is held by Generation Investment Management, managed by David Blood and Al Gore, which held a $46.1 million position; the fund has 1.1% of its 13F portfolio invested in the stock. Other hedge funds that are bullish include Jim Simons’s Renaissance Technologies, D. E. Shaw’s D E Shaw and Joel Greenblatt’s Gotham Asset Management.
Due to the fact that Strayer Education Inc (NASDAQ:STRA) has experienced falling interest from the entirety of the hedge funds we track, logic holds that there was a specific group of hedge funds that slashed their positions entirely last quarter. Intriguingly, Israel Englander’s Millennium Management dropped the largest position of the 450+ funds we track, comprising close to $0.9 million in stock.. Paul Tudor Jones’s fund, Tudor Investment Corp, also dumped its stock, about $0.4 million worth. These bearish behaviors are interesting, as total hedge fund interest fell by 1 funds last quarter.
What do corporate executives and insiders think about Strayer Education Inc (NASDAQ:STRA)?
Bullish insider trading is at its handiest when the company in question has experienced transactions within the past 180 days. Over the latest 180-day time frame, Strayer Education Inc (NASDAQ:STRA) has seen 2 unique insiders purchasing, and 5 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Strayer Education Inc (NASDAQ:STRA). These stocks are TAL Education Group (ADR) (NYSE:XRS), New Oriental Education & Tech Grp (ADR) (NYSE:EDU), GP Strategies Corporation (NYSE:GPX), Education Management Corp (NASDAQ:EDMC), and Bridgepoint Education Inc (NYSE:BPI). This group of stocks are in the education & training services industry and their market caps match STRA’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| TAL Education Group (ADR) (NYSE:XRS) | 5 | 0 | 0 |
| New Oriental Education & Tech Grp (ADR) (NYSE:EDU) | 7 | 0 | 0 |
| GP Strategies Corporation (NYSE:GPX) | 8 | 2 | 4 |
| Education Management Corp (NASDAQ:EDMC) | 6 | 1 | 0 |
| Bridgepoint Education Inc (NYSE:BPI) | 11 | 0 | 0 |
With the returns shown by our tactics, retail investors must always pay attention to hedge fund and insider trading activity, and Strayer Education Inc (NASDAQ:STRA) is an important part of this process.
