Here is What Hedge Funds Think About Gentex Corporation (GNTX)

Is Gentex Corporation (NASDAQ:GNTX) a great investment today? The smart money is taking a bearish view. The number of bullish hedge fund bets were cut by 2 lately.

To the average investor, there are dozens of indicators shareholders can use to watch stocks. A pair of the most useful are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite hedge fund managers can outperform the broader indices by a very impressive amount (see just how much).

Equally as important, optimistic insider trading sentiment is another way to parse down the marketplace. Just as you’d expect, there are plenty of stimuli for an executive to cut shares of his or her company, but only one, very clear reason why they would initiate a purchase. Various empirical studies have demonstrated the impressive potential of this strategy if shareholders understand what to do (learn more here).

With all of this in mind, it’s important to take a look at the key action encompassing Gentex Corporation (NASDAQ:GNTX).

How have hedgies been trading Gentex Corporation (NASDAQ:GNTX)?

At the end of the first quarter, a total of 13 of the hedge funds we track were long in this stock, a change of -13% from the previous quarter. With the smart money’s capital changing hands, there exists a few noteworthy hedge fund managers who were upping their holdings significantly.

According to our comprehensive database, Chuck Royce’s Royce & Associates had the largest position in Gentex Corporation (NASDAQ:GNTX), worth close to $45.9 million, accounting for 0.1% of its total 13F portfolio. Coming in second is Phill Gross and Robert Atchinson of Adage Capital Management, with a $42.6 million position; 0.1% of its 13F portfolio is allocated to the stock. Remaining hedgies that hold long positions include Jim Simons’s Renaissance Technologies, John Overdeck and David Siegel’s Two Sigma Advisors and Bill Miller’s Legg Mason Capital Management.

Due to the fact that Gentex Corporation (NASDAQ:GNTX) has faced declining sentiment from the smart money, it’s easy to see that there were a few fund managers who sold off their entire stakes at the end of the first quarter. It’s worth mentioning that Peter S. Park’s Park West Asset Management said goodbye to the biggest position of all the hedgies we track, totaling about $9.4 million in stock.. Mariko Gordon’s fund, Daruma Asset Management, also dumped its stock, about $2.8 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest dropped by 2 funds at the end of the first quarter.

How have insiders been trading Gentex Corporation (NASDAQ:GNTX)?

Insider purchases made by high-level executives is most useful when the primary stock in question has experienced transactions within the past six months. Over the latest 180-day time frame, Gentex Corporation (NASDAQ:GNTX) has experienced zero unique insiders purchasing, and 6 insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Gentex Corporation (NASDAQ:GNTX). These stocks are Allison Transmission Holdings Inc (NYSE:ALSN), WABCO Holdings Inc. (NYSE:WBC), Tenneco Inc (NYSE:TEN), Dana Holding Corporation (NYSE:DAN), and Visteon Corp (NYSE:VC). This group of stocks belong to the auto parts industry and their market caps are closest to GNTX’s market cap.

With the returns shown by Insider Monkey’s studies, retail investors should always pay attention to hedge fund and insider trading sentiment, and Gentex Corporation (NASDAQ:GNTX) applies perfectly to this mantra.

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