Alliant Energy Corporation (NYSE:LNT) shareholders have witnessed a decrease in hedge fund interest lately.
To most stock holders, hedge funds are seen as worthless, outdated financial vehicles of years past. While there are over 8000 funds in operation today, we at Insider Monkey hone in on the crème de la crème of this group, about 450 funds. It is estimated that this group controls the majority of the hedge fund industry’s total capital, and by keeping an eye on their top equity investments, we have spotted a few investment strategies that have historically beaten the market. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points annually 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 outperformed the S&P 500 index by 24 percentage points in 7 months (see the details here).
Equally as integral, optimistic insider trading activity is another way to break down the investments you’re interested in. Obviously, there are plenty of stimuli for a bullish insider to cut shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Many academic studies have demonstrated the valuable potential of this tactic if “monkeys” understand where to look (learn more here).
With these “truths” under our belt, we’re going to take a peek at the key action surrounding Alliant Energy Corporation (NYSE:LNT).
How have hedgies been trading Alliant Energy Corporation (NYSE:LNT)?
Heading into 2013, a total of 14 of the hedge funds we track were long in this stock, a change of 0% from one quarter earlier. With hedge funds’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their stakes meaningfully.
Of the funds we track, Israel Englander’s Millennium Management had the largest position in Alliant Energy Corporation (NYSE:LNT), worth close to $24 million, accounting for 0.2% of its total 13F portfolio. The second largest stake is held by D. E. Shaw of D E Shaw, with a $16 million position; 0% of its 13F portfolio is allocated to the stock. Remaining peers that are bullish include Cliff Asness’s AQR Capital Management, John Overdeck and David Siegel’s Two Sigma Advisors and Ken Gray and Steve Walsh’s Bryn Mawr Capital.
Since Alliant Energy Corporation (NYSE:LNT) has faced a declination in interest from hedge fund managers, it’s safe to say that there is a sect of fund managers that elected to cut their entire stakes heading into 2013. Interestingly, Charles Clough’s Clough Capital Partners said goodbye to the biggest position of the “upper crust” of funds we watch, comprising about $11 million in stock.. Tim Flannery’s fund, Copia Capital, also dumped its stock, about $3 million worth. These moves are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
What do corporate executives and insiders think about Alliant Energy Corporation (NYSE:LNT)?
Insider buying is best served when the company we’re looking at has seen transactions within the past six months. Over the last half-year time period, Alliant Energy Corporation (NYSE:LNT) has seen 1 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 Alliant Energy Corporation (NYSE:LNT). These stocks are Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR), ITC Holdings Corp. (NYSE:ITC), Pinnacle West Capital Corporation (NYSE:PNW), Pepco Holdings, Inc. (NYSE:POM), and Brookfield Infrastructure Partners L.P. (NYSE:BIP). This group of stocks belong to the electric utilities industry and their market caps match LNT’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR) | 7 | 0 | 0 |
| ITC Holdings Corp. (NYSE:ITC) | 12 | 0 | 4 |
| Pinnacle West Capital Corporation (NYSE:PNW) | 11 | 0 | 3 |
| Pepco Holdings, Inc. (NYSE:POM) | 6 | 0 | 1 |
| Brookfield Infrastructure Partners L.P. (NYSE:BIP) | 6 | 0 | 0 |
With the returns shown by the aforementioned tactics, retail investors should always monitor hedge fund and insider trading sentiment, and Alliant Energy Corporation (NYSE:LNT) is no exception.
