Movado Group, Inc (MOV): Are Hedge Funds Right About This Stock?

Movado Group, Inc (NYSE:MOV) has seen an increase in hedge fund sentiment lately.

In the 21st century investor’s toolkit, there are plenty of indicators market participants can use to analyze publicly traded companies. Some of the most innovative are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top fund managers can outperform their index-focused peers by a solid amount (see just how much).

Equally as important, positive insider trading activity is a second way to parse down the world of equities. As the old adage goes: there are many incentives for an upper level exec to drop shares of his or her company, but only one, very simple reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the valuable potential of this tactic if piggybackers know what to do (learn more here).

With all of this in mind, we’re going to take a gander at the key action surrounding Movado Group, Inc (NYSE:MOV).

What have hedge funds been doing with Movado Group, Inc (NYSE:MOV)?

Heading into Q2, a total of 24 of the hedge funds we track were bullish in this stock, a change of 4% from the previous quarter. With the smart money’s capital changing hands, there exists a few key hedge fund managers who were increasing their holdings substantially.

Of the funds we track, SAC Capital Advisors, managed by Steven Cohen, holds the largest position in Movado Group, Inc (NYSE:MOV). SAC Capital Advisors has a $30.8 million position in the stock, comprising 0.1% of its 13F portfolio. The second largest stake is held by SAC Subsidiary of Sigma Capital Management, with a $26.8 million position; 1.2% of its 13F portfolio is allocated to the stock. Other hedge funds with similar optimism include Cliff Asness’s AQR Capital Management, Richard Driehaus’s Driehaus Capital and Jim Simons’s Renaissance Technologies.

Now, specific money managers were leading the bulls’ herd. Balyasny Asset Management, managed by Dmitry Balyasny, established the most outsized position in Movado Group, Inc (NYSE:MOV). Balyasny Asset Management had 2.5 million invested in the company at the end of the quarter. Malcolm Fairbairn’s Ascend Capital also made a $0.8 million investment in the stock during the quarter. The other funds with new positions in the stock are Andrew Wallach’s Cumberland Associates, J. Alan Reid, Jr.’s Forward Management, and Peter Algert and Kevin Coldiron’s Algert Coldiron Investors.

How have insiders been trading Movado Group, Inc (NYSE:MOV)?

Insider trading activity, especially when it’s bullish, is most useful when the company we’re looking at has experienced transactions within the past six months. Over the latest six-month time period, Movado Group, Inc (NYSE:MOV) has seen zero unique insiders purchasing, and 2 insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Movado Group, Inc (NYSE:MOV). These stocks are A.T. Cross Company (NASDAQ:ATX), Brunswick Corporation (NYSE:BC), Manchester United PLC (NYSE:MANU), Steinway Musical Instruments Inc (NYSE:LVB), and SHFL entertainment Inc (NASDAQ:SHFL). This group of stocks are in the recreational goods, other industry and their market caps resemble MOV’s market cap.