Should You Avoid Hub Group Inc (HUBG)?

Is Hub Group Inc (NASDAQ:HUBG) a first-rate investment right now? The best stock pickers are getting less bullish. The number of bullish hedge fund bets were cut by 6 lately.

In the 21st century investor’s toolkit, there are dozens of gauges market participants can use to track Mr. Market. A duo of the most useful are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the top hedge fund managers can outclass the S&P 500 by a significant amount (see just how much).

Equally as important, bullish insider trading activity is a second way to break down the world of equities. As the old adage goes: there are plenty of reasons for a corporate insider to downsize shares of his or her company, but just one, very simple reason why they would initiate a purchase. Plenty of academic studies have demonstrated the market-beating potential of this strategy if shareholders understand where to look (learn more here).

Now, it’s important to take a look at the latest action surrounding Hub Group Inc (NASDAQ:HUBG).

Hedge fund activity in Hub Group Inc (NASDAQ:HUBG)

At Q1’s end, a total of 8 of the hedge funds we track were long in this stock, a change of -43% from the previous quarter. With hedgies’ sentiment swirling, there exists an “upper tier” of key hedge fund managers who were upping their holdings substantially.

Of the funds we track, Diamond Hill Capital, managed by Ric Dillon, holds the most valuable position in Hub Group Inc (NASDAQ:HUBG). Diamond Hill Capital has a $25 million position in the stock, comprising 0.3% of its 13F portfolio. Coming in second is Royce & Associates, managed by Chuck Royce, which held a $15.3 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining hedge funds with similar optimism include Michael R. Weisberg’s Crestwood Capital Management, Joel Greenblatt’s Gotham Asset Management and Jim Simons’s Renaissance Technologies.

Because Hub Group Inc (NASDAQ:HUBG) has experienced falling interest from the smart money, it’s easy to see that there was a specific group of hedgies who were dropping their positions entirely in Q1. At the top of the heap, Dmitry Balyasny’s Balyasny Asset Management dropped the largest investment of the 450+ funds we monitor, totaling an estimated $3.5 million in stock.. Richard Chilton’s fund, Chilton Investment Company, also dumped its stock, about $1.9 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest fell by 6 funds in Q1.

What do corporate executives and insiders think about Hub Group Inc (NASDAQ:HUBG)?

Bullish insider trading is best served when the company in question has seen transactions within the past six months. Over the latest 180-day time frame, Hub Group Inc (NASDAQ:HUBG) has experienced zero unique insiders buying, and 4 insider sales (see the details of insider trades here).

Let’s also take a look at hedge fund and insider activity in other stocks similar to Hub Group Inc (NASDAQ:HUBG). These stocks are XPO Logistics Inc (NYSE:XPO), Air Transport Services Group Inc. (NASDAQ:ATSG), Roadrunner Transportation Systems Inc (NYSE:RRTS), Forward Air Corporation (NASDAQ:FWRD), and UTi Worldwide Inc. (NASDAQ:UTIW). This group of stocks are the members of the air delivery & freight services industry and their market caps are similar to HUBG’s market cap.

With the results exhibited by our time-tested strategies, everyday investors should always pay attention to hedge fund and insider trading sentiment, and Hub Group Inc (NASDAQ:HUBG) is an important part of this process.

Click here to learn why you should track hedge funds