Should You Avoid First Majestic Silver Corp (AG)?

Is First Majestic Silver Corp (NYSE:AG) a great investment right now? The best stock pickers are becoming less confident. The number of long hedge fund positions were trimmed by 2 lately.

To the average investor, there are dozens of metrics shareholders can use to monitor publicly traded companies. A pair of the most underrated are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best fund managers can outpace the broader indices by a significant margin (see just how much).

Equally as key, bullish insider trading sentiment is a second way to break down the stock market universe. Obviously, there are many incentives for an upper level exec to cut shares of his or her company, but just one, very simple reason why they would initiate a purchase. Several academic studies have demonstrated the impressive potential of this method if piggybackers know what to do (learn more here).

With all of this in mind, let’s take a glance at the key action encompassing First Majestic Silver Corp (NYSE:AG).

How have hedgies been trading First Majestic Silver Corp (NYSE:AG)?

At the end of the fourth quarter, a total of 5 of the hedge funds we track were bullish in this stock, a change of -29% from the third quarter. With hedgies’ sentiment swirling, there exists a select group of key hedge fund managers who were boosting their holdings considerably.

According to our comprehensive database, Eric Sprott’s Sprott Asset Management had the most valuable position in First Majestic Silver Corp (NYSE:AG), worth close to $96.5 million, comprising 11.4% of its total 13F portfolio. The second largest stake is held by Jim Simons of Renaissance Technologies, with a $8.8 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other hedgies that hold long positions include Michael Hintze’s CQS Cayman LP, Ken Griffin’s Citadel Investment Group and Ken Griffin’s Citadel Investment Group.

Since First Majestic Silver Corp (NYSE:AG) has faced bearish sentiment from the smart money, it’s easy to see that there were a few funds that slashed their positions entirely in Q4. Intriguingly, Charles Davidson’s Wexford Capital dropped the largest stake of the 450+ funds we track, comprising an estimated $5.2 million in stock., and Anthony Bozza of Lakewood Capital Management was right behind this move, as the fund dropped about $1 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest fell by 2 funds in Q4.

Insider trading activity in First Majestic Silver Corp (NYSE:AG)

Bullish insider trading is at its handiest when the company we’re looking at has seen transactions within the past 180 days. Over the last six-month time frame, First Majestic Silver Corp (NYSE:AG) has seen zero 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 First Majestic Silver Corp (NYSE:AG). These stocks are Silvercorp Metals Inc. (USA) (NYSE:SVM), Silver Standard Resources Inc. (USA) (NASDAQ:SSRI), Pan American Silver Corp. (USA) (NASDAQ:PAAS), Hecla Mining Company (NYSE:HL), and Coeur d’Alene Mines Corporation (NYSE:CDE). This group of stocks belong to the silver industry and their market caps are closest to AG’s market cap.