Is Capstone Turbine Corporation (NASDAQ:CPST) undervalued? Investors who are in the know are taking an optimistic view. The number of bullish hedge fund positions rose by 1 recently.
In today’s marketplace, there are dozens of metrics investors can use to track publicly traded companies. A pair of the most innovative are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite fund managers can outpace the market by a solid margin (see just how much).
Equally as important, bullish insider trading sentiment is a second way to parse down the stock market universe. Just as you’d expect, there are many motivations for an executive to cut shares of his or her company, but only one, very clear reason why they would initiate a purchase. Several academic studies have demonstrated the valuable potential of this strategy if you understand where to look (learn more here).
Consequently, it’s important to take a peek at the recent action regarding Capstone Turbine Corporation (NASDAQ:CPST).
How have hedgies been trading Capstone Turbine Corporation (NASDAQ:CPST)?
Heading into Q2, a total of 7 of the hedge funds we track were long in this stock, a change of 17% from the first quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes considerably.
Of the funds we track, Kerr Neilson’s Platinum Asset Management had the most valuable position in Capstone Turbine Corporation (NASDAQ:CPST), worth close to $15.1 million, comprising 0.3% of its total 13F portfolio. Sitting at the No. 2 spot is D E Shaw, managed by D. E. Shaw, which held a $0.8 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining peers with similar optimism include William Harnisch’s Peconic Partners LLC, Ken Griffin’s Citadel Investment Group and Matthew Tewksbury’s Stevens Capital Management.
Consequently, some big names have been driving this bullishness. Two Sigma Advisors, managed by John Overdeck and David Siegel, established the biggest position in Capstone Turbine Corporation (NASDAQ:CPST). Two Sigma Advisors had 0 million invested in the company at the end of the quarter.
What have insiders been doing with Capstone Turbine Corporation (NASDAQ:CPST)?
Insider purchases made by high-level executives is particularly usable when the company we’re looking at has seen transactions within the past six months. Over the last half-year time period, Capstone Turbine Corporation (NASDAQ:CPST) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Capstone Turbine Corporation (NASDAQ:CPST). These stocks are Preformed Line Products Company (NASDAQ:PLPC), Exide Technologies (NASDAQ:XIDE), Ameresco Inc (NYSE:AMRC), Electro Scientific Industries, Inc. (NASDAQ:ESIO), and Coleman Cable, Inc. (NASDAQ:CCIX). This group of stocks are in the industrial electrical equipment industry and their market caps match CPST’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Preformed Line Products Company (NASDAQ:PLPC) | 4 | 1 | 6 |
| Exide Technologies (NASDAQ:XIDE) | 14 | 1 | 0 |
| Ameresco Inc (NYSE:AMRC) | 12 | 2 | 1 |
| Electro Scientific Industries, Inc. (NASDAQ:ESIO) | 6 | 0 | 1 |
| Coleman Cable, Inc. (NASDAQ:CCIX) | 4 | 1 | 0 |
With the results exhibited by Insider Monkey’s studies, retail investors must always pay attention to hedge fund and insider trading activity, and Capstone Turbine Corporation (NASDAQ:CPST) is no exception.
