Radware Ltd. (RDWR): Insiders Are Dumping, Should You?

Is Radware Ltd. (NASDAQ:RDWR) a buy, sell, or hold? Money managers are in a bearish mood. The number of long hedge fund positions were cut by 3 in recent months.

To the average investor, there are dozens of gauges market participants can use to watch the equity markets. Some of the most under-the-radar are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite fund managers can beat the market by a healthy amount (see just how much).

Equally as integral, bullish insider trading sentiment is a second way to parse down the marketplace. As the old adage goes: there are many stimuli for an insider to get rid of shares of his or her company, but just one, very obvious reason why they would buy. Plenty of empirical studies have demonstrated the market-beating potential of this strategy if piggybackers know where to look (learn more here).

Now, let’s take a look at the recent action surrounding Radware Ltd. (NASDAQ:RDWR).

What does the smart money think about Radware Ltd. (NASDAQ:RDWR)?

At the end of the fourth quarter, a total of 10 of the hedge funds we track were long in this stock, a change of -23% from one quarter earlier. With hedge funds’ sentiment swirling, there exists a select group of notable hedge fund managers who were boosting their holdings meaningfully.

Of the funds we track, Eric Bannasch’s Cadian Capital had the biggest position in Radware Ltd. (NASDAQ:RDWR), worth close to $59.9 million, comprising 2% of its total 13F portfolio. On Cadian Capital’s heels is York Capital Management, managed by James Dinan, which held a $48.3 million position; 1.2% of its 13F portfolio is allocated to the company. Other hedgies that hold long positions include D. E. Shaw’s D E Shaw, Steven Cohen’s SAC Capital Advisors and Brian Ashford-Russell and Tim Woolley’s Polar Capital.

Because Radware Ltd. (NASDAQ:RDWR) has experienced a declination in interest from hedge fund managers, it’s safe to say that there were a few hedgies that decided to sell off their full holdings at the end of the year. It’s worth mentioning that Guru Ramakrishnan’s Meru Capital sold off the biggest investment of the 450+ funds we watch, worth an estimated $1.4 million in stock.. Peter A. Wright’s fund, P.A.W. CAPITAL PARTNERS, also dropped its stock, about $1.4 million worth. These bearish behaviors are important to note, as total hedge fund interest dropped by 3 funds at the end of the year.

What do corporate executives and insiders think about Radware Ltd. (NASDAQ:RDWR)?

Insider purchases made by high-level executives is best served when the company we’re looking at has experienced transactions within the past six months. Over the last six-month time frame, Radware Ltd. (NASDAQ:RDWR) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Radware Ltd. (NASDAQ:RDWR). These stocks are iGATE Corporation (NASDAQ:IGTE), EPAM Systems Inc (NYSE:EPAM), Unisys Corporation (NYSE:UIS), Virtusa Corporation (NASDAQ:VRTU), and Sykes Enterprises, Incorporated (NASDAQ:SYKE). This group of stocks are in the information technology services industry and their market caps are similar to RDWR’s market cap.