Is RR Donnelley & Sons Co (NASDAQ:RRD) a buy, sell, or hold? Hedge funds are getting more optimistic. The number of long hedge fund bets rose by 3 recently.
In the 21st century investor’s toolkit, there are dozens of metrics investors can use to track their holdings. A duo of the most under-the-radar are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top hedge fund managers can outpace the market by a superb amount (see just how much).
Just as key, optimistic insider trading activity is a second way to break down the investments you’re interested in. There are a variety of motivations for an insider to sell shares of his or her company, but just one, very clear reason why they would buy. Many empirical studies have demonstrated the useful potential of this method if shareholders understand where to look (learn more here).
Consequently, it’s important to take a glance at the latest action encompassing RR Donnelley & Sons Co (NASDAQ:RRD).
What does the smart money think about RR Donnelley & Sons Co (NASDAQ:RRD)?
Heading into 2013, a total of 19 of the hedge funds we track were long in this stock, a change of 19% from the third quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were boosting their stakes meaningfully.
Of the funds we track, Chase Coleman and Feroz Dewan’s Tiger Global Management LLC had the most valuable position in RR Donnelley & Sons Co (NASDAQ:RRD), worth close to $31.5 million, comprising 0.6% of its total 13F portfolio. On Tiger Global Management LLC’s heels is Ron Gutfleish of Elm Ridge Capital, with a $31.3 million position; the fund has 3.5% of its 13F portfolio invested in the stock. Some other hedgies that are bullish include Philippe Laffont’s Coatue Management, Cliff Asness’s AQR Capital Management and David Gallo’s Valinor Management LLC.
As industrywide interest jumped, some big names have jumped into RR Donnelley & Sons Co (NASDAQ:RRD) headfirst. Valinor Management LLC, managed by David Gallo, created the largest position in RR Donnelley & Sons Co (NASDAQ:RRD). Valinor Management LLC had 7 million invested in the company at the end of the quarter. Christian Leone’s Luxor Capital Group also initiated a $0.6 million position during the quarter. The other funds with new positions in the stock are Paul Tudor Jones’s Tudor Investment Corp, Steven Cohen’s SAC Capital Advisors, and Bruce Kovner’s Caxton Associates LP.
Insider trading activity in RR Donnelley & Sons Co (NASDAQ:RRD)
Bullish insider trading is most useful when the primary stock in question has experienced transactions within the past half-year. Over the last 180-day time frame, RR Donnelley & Sons Co (NASDAQ:RRD) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to RR Donnelley & Sons Co (NASDAQ:RRD). These stocks are HMS Holdings Corp. (NASDAQ:HMSY), Ritchie Bros. Auctioneers (USA) (NYSE:RBA), Deluxe Corporation (NYSE:DLX), Portfolio Recovery Associates, Inc. (NASDAQ:PRAA), and Lender Processing Services, Inc. (NYSE:LPS). All of these stocks are in the business services industry and their market caps are similar to RRD’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| HMS Holdings Corp. (NASDAQ:HMSY) | 8 | 0 | 9 |
| Ritchie Bros. Auctioneers (USA) (NYSE:RBA) | 6 | 0 | 0 |
| Deluxe Corporation (NYSE:DLX) | 8 | 0 | 6 |
| Portfolio Recovery Associates, Inc. (NASDAQ:PRAA) | 4 | 0 | 8 |
| Lender Processing Services, Inc. (NYSE:LPS) | 17 | 1 | 0 |
With the returns demonstrated by our strategies, everyday investors should always monitor hedge fund and insider trading sentiment, and RR Donnelley & Sons Co (NASDAQ:RRD) applies perfectly to this mantra.
