Is Millennial Media, Inc. (MM) Going to Burn These Hedge Funds?

Should Millennial Media, Inc. (NYSE:MM) investors track the f

In the 21st century investor’s toolkit, there are tons of methods investors can use to track the equity markets. A duo of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top investment managers can outperform their index-focused peers by a very impressive amount (see just how much).

Just as crucial, optimistic insider trading sentiment is a second way to look at the investments you’re interested in. Obviously, there are a variety of motivations for an insider to downsize shares of his or her company, but just one, very clear reason why they would initiate a purchase. Various academic studies have demonstrated the market-beating potential of this strategy if piggybackers know where to look (learn more here).

Now that that’s out of the way, it’s important to examine the recent info for Millennial Media, Inc. (NYSE:MM).

How are hedge funds trading Millennial Media, Inc. (NYSE:MM)?

In preparation for the third quarter, a total of 10 of the hedge funds we track held long positions in this stock, a change of -17% from one quarter earlier. With hedge funds’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes meaningfully.

According to our 13F database, Shannon River Fund Management, managed by Spencer M. Waxman, holds the largest position in Millennial Media, Inc. (NYSE:MM). Shannon River Fund Management has a $15.9 million position in the stock, comprising 1.9% of its 13F portfolio. Coming in second is Soros Fund Management, managed by George Soros, which held a $7 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other hedgies that hold long positions include Jim Simons’s Renaissance Technologies, Anand Parekh’s Alyeska Investment Group and Ian P. Murray’s Lanexa Global Management.

Because Millennial Media, Inc. (NYSE:MM) has experienced bearish sentiment from the entirety of the hedge funds we track, logic holds that there lies a certain “tier” of hedgies that decided to sell off their entire stakes heading into Q2. At the top of the heap, Steven Cohen’s SAC Capital Advisors said goodbye to the largest stake of the “upper crust” of funds we monitor, worth about $2.2 million in stock. Israel Englander’s fund, Millennium Management, also said goodbye to its stock, about $1.4 million worth. These moves are interesting, as total hedge fund interest dropped by 2 funds heading into Q2.

How are insiders trading Millennial Media, Inc. (NYSE:MM)?

Bullish insider trading is most useful when the primary stock in question has seen transactions within the past six months. Over the latest half-year time period, Millennial Media, Inc. (NYSE:MM) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

We’ll also examine the relationship between both of these indicators in other stocks similar to Millennial Media, Inc. (NYSE:MM). These stocks are Valassis Communications, Inc. (NYSE:VCI), National CineMedia, Inc. (NASDAQ:NCMI), Constant Contact Inc (NASDAQ:CTCT), Harte-Hanks, Inc. (NYSE:HHS), and MDC Partners Inc. (USA) (NASDAQ:MDCA). All of these stocks are in the marketing services industry and their market caps are closest to MM’s market cap.