Is Citrix Systems, Inc. (CTXS) Going to Burn These Hedge Funds?

Citrix Systems, Inc. (NASDAQ:CTXS) was in 36 hedge funds’ portfolio at the end of March. CTXS shareholders have witnessed a decrease in hedge fund interest recently. There were 39 hedge funds in our database with CTXS holdings at the end of the previous quarter.

In the financial world, there are many gauges shareholders can use to track publicly traded companies. A duo of the best are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best investment managers can beat the broader indices by a very impressive amount (see just how much).

Just as integral, bullish insider trading sentiment is a second way to parse down the financial markets. Obviously, there are a variety of stimuli for an insider to downsize shares of his or her company, but only one, very simple reason why they would behave bullishly. Plenty of academic studies have demonstrated the market-beating potential of this tactic if “monkeys” understand where to look (learn more here).

Keeping this in mind, it’s important to take a peek at the latest action regarding Citrix Systems, Inc. (NASDAQ:CTXS).

What does the smart money think about Citrix Systems, Inc. (NASDAQ:CTXS)?

In preparation for this quarter, a total of 36 of the hedge funds we track held long positions in this stock, a change of -8% from the first quarter. With the smart money’s capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their stakes meaningfully.

Of the funds we track, Christopher Medlock James’s Partner Fund Management had the biggest position in Citrix Systems, Inc. (NASDAQ:CTXS), worth close to $237.7 million, accounting for 7.9% of its total 13F portfolio. On Partner Fund Management’s heels is Lee Ainslie of Maverick Capital, with a $235.2 million position; the fund has 3% of its 13F portfolio invested in the stock. Other peers with similar optimism include Ken Griffin’s Citadel Investment Group, David Blood and Al Gore’s Generation Investment Management and Bain Capital’s Brookside Capital.

Seeing as Citrix Systems, Inc. (NASDAQ:CTXS) has faced bearish sentiment from the smart money, it’s safe to say that there were a few hedge funds that elected to cut their entire stakes last quarter. Interestingly, John Thaler’s JAT Capital Management dumped the biggest stake of the 450+ funds we key on, totaling about $61.4 million in stock., and Pasco Alfaro / Richard Tumure of Miura Global Management was right behind this move, as the fund dumped about $32.8 million worth. These bearish behaviors are interesting, as total hedge fund interest was cut by 3 funds last quarter.

What do corporate executives and insiders think about Citrix Systems, Inc. (NASDAQ:CTXS)?

Bullish insider trading is most useful when the company we’re looking at has seen transactions within the past six months. Over the last six-month time period, Citrix Systems, Inc. (NASDAQ:CTXS) has experienced zero unique insiders purchasing, and 10 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 Citrix Systems, Inc. (NASDAQ:CTXS). These stocks are Automatic Data Processing (NASDAQ:ADP), NetSuite Inc (NYSE:N), Amdocs Limited (NYSE:DOX), Iron Mountain Incorporated (NYSE:IRM), and Cognizant Technology Solutions Corp (NASDAQ:CTSH). All of these stocks are in the business software & services industry and their market caps are similar to CTXS’s market cap.

With the returns demonstrated by the aforementioned time-tested strategies, retail investors should always watch hedge fund and insider trading sentiment, and Citrix Systems, Inc. (NASDAQ:CTXS) shareholders fit into this picture quite nicely.

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