Is Kinder Morgan Management, LLC (NYSE:KMR) a buy, sell, or hold? Money managers are in a bearish mood. The number of long hedge fund bets shrunk by 5 in recent months.
At the moment, there are a multitude of metrics market participants can use to watch Mr. Market. A pair of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top fund managers can outclass the broader indices by a superb amount (see just how much).
Just as important, bullish insider trading activity is a second way to parse down the financial markets. Obviously, there are a variety of reasons for an executive to sell shares of his or her company, but only one, very simple reason why they would behave bullishly. Several academic studies have demonstrated the useful potential of this method if investors know what to do (learn more here).
With all of this in mind, we’re going to take a glance at the key action encompassing Kinder Morgan Management, LLC (NYSE:KMR).
Hedge fund activity in Kinder Morgan Management, LLC (NYSE:KMR)
At the end of the fourth quarter, a total of 7 of the hedge funds we track were bullish in this stock, a change of -42% from one quarter earlier. With the smart money’s capital changing hands, there exists a few noteworthy hedge fund managers who were upping their stakes considerably.
When looking at the hedgies we track, Ken Griffin’s Citadel Investment Group had the most valuable position in Kinder Morgan Management, LLC (NYSE:KMR), worth close to $14.3 million, accounting for less than 0.1%% of its total 13F portfolio. The second largest stake is held by D. E. Shaw of D E Shaw, with a $10.6 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining hedge funds with similar optimism include Richard Driehaus’s Driehaus Capital, John Zaro’s Bourgeon Capital and Brian Bares’s Bares Capital Management.
Judging by the fact that Kinder Morgan Management, LLC (NYSE:KMR) has witnessed falling interest from the smart money, logic holds that there is a sect of hedge funds who were dropping their positions entirely heading into 2013. Intriguingly, Jim Simons’s Renaissance Technologies dropped the largest stake of the “upper crust” of funds we key on, comprising close to $7.3 million in stock.. William Michaelcheck’s fund, Mariner Investment Group, also said goodbye to its stock, about $4.2 million worth. These bearish behaviors are interesting, as total hedge fund interest fell by 5 funds heading into 2013.
What have insiders been doing with Kinder Morgan Management, LLC (NYSE:KMR)?
Insider buying is best served when the company we’re looking at has seen transactions within the past six months. Over the latest six-month time frame, Kinder Morgan Management, LLC (NYSE:KMR) has experienced 2 unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Kinder Morgan Management, LLC (NYSE:KMR). These stocks are Oneok Partners LP (NYSE:OKS), Magellan Midstream Partners, L.P. (NYSE:MMP), Enbridge Energy Partners, L.P. (NYSE:EEP), Pembina Pipeline Corp (NYSE:PBA), and El Paso Pipeline Partners, L.P. (NYSE:EPB). This group of stocks are in the oil & gas pipelines industry and their market caps match KMR’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Oneok Partners LP (NYSE:OKS) | 5 | 1 | 0 |
| Magellan Midstream Partners, L.P. (NYSE:MMP) | 9 | 0 | 1 |
| Enbridge Energy Partners, L.P. (NYSE:EEP) | 5 | 3 | 0 |
| Pembina Pipeline Corp (NYSE:PBA) | 5 | 0 | 0 |
| El Paso Pipeline Partners, L.P. (NYSE:EPB) | 7 | 0 | 0 |
With the returns demonstrated by our tactics, everyday investors should always watch hedge fund and insider trading sentiment, and Kinder Morgan Management, LLC (NYSE:KMR) is no exception.
