Is Veeco Instruments Inc. (VECO) Going to Burn These Hedge Funds?

Veeco Instruments Inc. (NASDAQ:VECO) was in 16 hedge funds’ portfolio at the end of the first quarter of 2013. VECO investors should be aware of a decrease in support from the world’s most elite money managers in recent months. There were 16 hedge funds in our database with VECO holdings at the end of the previous quarter.

To the average investor, there are tons of methods investors can use to monitor their holdings. Some of the most under-the-radar are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite money managers can beat the market by a superb margin (see just how much).

Equally as key, positive insider trading activity is a second way to break down the stock market universe. As the old adage goes: there are many stimuli for a bullish insider to sell shares of his or her company, but only one, very obvious reason why they would initiate a purchase. Many academic studies have demonstrated the market-beating potential of this tactic if you understand what to do (learn more here).

Keeping this in mind, let’s take a peek at the key action encompassing Veeco Instruments Inc. (NASDAQ:VECO).

What have hedge funds been doing with Veeco Instruments Inc. (NASDAQ:VECO)?

Heading into Q2, a total of 16 of the hedge funds we track held long positions in this stock, a change of 0% from the first quarter. With the smart money’s capital changing hands, there exists a select group of key hedge fund managers who were increasing their holdings significantly.

According to our comprehensive database, Chuck Royce’s Royce & Associates had the largest position in Veeco Instruments Inc. (NASDAQ:VECO), worth close to $143.1 million, accounting for 0.4% of its total 13F portfolio. The second largest stake is held by Ken Fisher of Fisher Asset Management, with a $94.9 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Some other hedge funds with similar optimism include Michael Kaufman’s MAK Capital One, Robert Karr’s Joho Capital and Robert Rodriguez and Steven Romick’s First Pacific Advisors LLC.

Since Veeco Instruments Inc. (NASDAQ:VECO) has witnessed a declination in interest from the smart money, logic holds that there were a few hedge funds that decided to sell off their positions entirely in Q1. Intriguingly, Matthew Hulsizer’s PEAK6 Capital Management cut the biggest stake of all the hedgies we watch, totaling close to $1 million in stock.. Daniel S. Och’s fund, OZ Management, also sold off its stock, about $0.8 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Insider trading activity in Veeco Instruments Inc. (NASDAQ:VECO)

Insider trading activity, especially when it’s bullish, is best served when the company in question has experienced transactions within the past half-year. Over the latest half-year time period, Veeco Instruments Inc. (NASDAQ:VECO) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

Let’s check out hedge fund and insider activity in other stocks similar to Veeco Instruments Inc. (NASDAQ:VECO). These stocks are Kulicke and Soffa Industries Inc. (NASDAQ:KLIC), Tessera Technologies, Inc. (NASDAQ:TSRA), ASM International NV (ADR) (NASDAQ:ASMI), Ultratech, Inc. (NASDAQ:UTEK), and Entegris Inc (NASDAQ:ENTG). This group of stocks belong to the semiconductor equipment & materials industry and their market caps are similar to VECO’s market cap.

With the results exhibited by our strategies, retail investors should always pay attention to hedge fund and insider trading sentiment, and Veeco Instruments Inc. (NASDAQ:VECO) is an important part of this process.

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