What’s a smart PennantPark Investment Corp. (NASDAQ:PNNT) investor to do?
To the average investor, there are tons of metrics market participants can use to track Mr. Market. Two of the best are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite fund managers can outclass the S&P 500 by a solid margin (see just how much).
Equally as crucial, positive insider trading sentiment is a second way to analyze the investments you’re interested in. There are many reasons for an executive to downsize shares of his or her company, but only one, very clear reason why they would buy. Many empirical studies have demonstrated the valuable potential of this tactic if piggybackers understand where to look (learn more here).
Now that that’s out of the way, let’s examine the recent info for PennantPark Investment Corp. (NASDAQ:PNNT).
What have hedge funds been doing with PennantPark Investment Corp. (NASDAQ:PNNT)?
At the end of the second quarter, a total of 5 of the hedge funds we track were bullish in this stock, a change of -44% from one quarter earlier. With hedge funds’ capital changing hands, there exists a few key hedge fund managers who were boosting their holdings significantly.
According to our 13F database, Cliff Asness’s AQR Capital Management had the most valuable position in PennantPark Investment Corp. (NASDAQ:PNNT), worth close to $5.5 million, comprising less than 0.1%% of its total 13F portfolio. The second largest stake is held by ADAR Investment Management, managed by Abby Flamholz and Yehuda Blinder, which held a $2.1 million position; 0.5% of its 13F portfolio is allocated to the company. Remaining hedgies that hold long positions include Bruce Silver’s Silver Capital Management LLC, Scott Scher & Michael Prober’s Clovis Capital Management and Matthew Hulsizer’s PEAK6 Capital Management.
Because PennantPark Investment Corp. (NASDAQ:PNNT) has faced bearish sentiment from the smart money’s best and brightest, logic holds that there was a specific group of money managers that elected to cut their positions entirely at the end of the second quarter. Intriguingly, Charles Clough’s Clough Capital Partners dropped the largest stake of the “upper crust” of funds we watch, totaling about $7.2 million in stock, and Israel Englander of Millennium Management was right behind this move, as the fund sold off about $0.9 million worth. These moves are interesting, as aggregate hedge fund interest was cut by 4 funds at the end of the second quarter.
What do corporate executives and insiders think about PennantPark Investment Corp. (NASDAQ:PNNT)?
Insider buying is particularly usable when the company we’re looking at has experienced transactions within the past six months. Over the latest half-year time frame, PennantPark Investment Corp. (NASDAQ:PNNT) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We’ll also review the relationship between both of these indicators in other stocks similar to PennantPark Investment Corp. (NASDAQ:PNNT). These stocks are Westwood Holdings Group, Inc. (NYSE:WHG), Capital Southwest Corporation (NASDAQ:CSWC), THL Credit, Inc. (NASDAQ:TCRD), Pzena Investment Management, Inc. (NYSE:PZN), and Noah Holdings Limited (ADR) (NYSE:NOAH). This group of stocks are in the asset management industry and their market caps are closest to PNNT’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Westwood Holdings Group, Inc. (NYSE:WHG) | 5 | 0 | 0 |
| Capital Southwest Corporation (NASDAQ:CSWC) | 4 | 0 | 0 |
| THL Credit, Inc. (NASDAQ:TCRD) | 10 | 0 | 0 |
| Pzena Investment Management, Inc. (NYSE:PZN) | 5 | 0 | 0 |
| Noah Holdings Limited (ADR) (NYSE:NOAH) | 4 | 0 | 0 |
Using the results shown by our tactics, regular investors should always pay attention to hedge fund and insider trading activity, and PennantPark Investment Corp. (NASDAQ:PNNT) applies perfectly to this mantra.
Discover how hedge fund piggybacking can benefit you
Recommended Reading:
