Weyerhaeuser Company (NYSE:WY) shareholders have witnessed an increase in enthusiasm from smart money lately.
If you’d ask most shareholders, hedge funds are seen as underperforming, outdated financial vehicles of yesteryear. While there are over 8000 funds trading today, we at Insider Monkey hone in on the crème de la crème of this group, close to 450 funds. It is widely believed that this group oversees the majority of the smart money’s total asset base, and by watching their top investments, we have identified a few investment strategies that have historically outperformed the S&P 500 index. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have beaten the S&P 500 index by 23.3 percentage points in 8 months (see all of our picks from August).
Equally as key, optimistic insider trading sentiment is another way to break down the financial markets. Just as you’d expect, there are a number of incentives for an insider to cut shares of his or her company, but just one, very obvious reason why they would behave bullishly. Various empirical studies have demonstrated the impressive potential of this strategy if “monkeys” understand what to do (learn more here).
Keeping this in mind, it’s important to take a gander at the recent action encompassing Weyerhaeuser Company (NYSE:WY).
What does the smart money think about Weyerhaeuser Company (NYSE:WY)?
In preparation for this quarter, a total of 33 of the hedge funds we track held long positions in this stock, a change of 6% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were upping their stakes considerably.
According to our comprehensive database, Jean-Marie Eveillard’s First Eagle Investment Management had the largest position in Weyerhaeuser Company (NYSE:WY), worth close to $462.8 million, comprising 1.5% of its total 13F portfolio. Coming in second is Third Avenue Management, managed by Martin Whitman, which held a $194.1 million position; 3.7% of its 13F portfolio is allocated to the company. Other hedge funds with similar optimism include Robert Bishop’s Impala Asset Management, Sean Cullinan’s Point State Capital and Jeffrey Vinik’s Vinik Asset Management.
As aggregate interest increased, key money managers have been driving this bullishness. Carlson Capital, managed by Clint Carlson, initiated the most outsized position in Weyerhaeuser Company (NYSE:WY). Carlson Capital had 15.4 million invested in the company at the end of the quarter. Jim Simons’s Renaissance Technologies also made a $7.7 million investment in the stock during the quarter. The other funds with new positions in the stock are Larry Foley and Paul Farrell’s Bronson Point Partners, Joe DiMenna’s ZWEIG DIMENNA PARTNERS, and Philip Hempleman’s Ardsley Partners.
What have insiders been doing with Weyerhaeuser Company (NYSE:WY)?
Bullish insider trading is at its handiest when the company in question has experienced transactions within the past six months. Over the latest half-year time frame, Weyerhaeuser Company (NYSE:WY) has seen zero unique insiders buying, and 8 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Weyerhaeuser Company (NYSE:WY). These stocks are Jewett-Cameron Trading Co Ltd. (NASDAQ:JCTCF), Patrick Industries, Inc. (NASDAQ:PATK), Pope Resources L.P. (NASDAQ:POPE), Deltic Timber Corp (NYSE:DEL), and Rayonier Inc. (NYSE:RYN). This group of stocks are in the lumber, wood production industry and their market caps match WY’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Jewett-Cameron Trading Co Ltd. (NASDAQ:JCTCF) | 1 | 0 | 2 |
| Patrick Industries, Inc. (NASDAQ:PATK) | 5 | 1 | 7 |
| Pope Resources L.P. (NASDAQ:POPE) | 3 | 1 | 0 |
| Deltic Timber Corp (NYSE:DEL) | 6 | 0 | 5 |
| Rayonier Inc. (NYSE:RYN) | 13 | 0 | 5 |
With the returns shown by our research, retail investors should always pay attention to hedge fund and insider trading sentiment, and Weyerhaeuser Company (NYSE:WY) is no exception.
