Is Aetna Inc. (NYSE:AET) a superb investment right now? Investors who are in the know are betting on the stock. The number of long hedge fund positions improved by 7 recently.
In the financial world, there are many gauges market participants can use to track publicly traded companies. A couple of the most useful are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the elite money managers can outpace their index-focused peers by a superb margin (see just how much).
Just as key, positive insider trading sentiment is another way to break down the investments you’re interested in. As the old adage goes: there are lots of reasons for an executive to sell shares of his or her company, but just one, very clear reason why they would initiate a purchase. Plenty of academic studies have demonstrated the market-beating potential of this strategy if you understand where to look (learn more here).
With these “truths” under our belt, let’s take a peek at the recent action regarding Aetna Inc. (NYSE:AET).
How have hedgies been trading Aetna Inc. (NYSE:AET)?
At the end of the first quarter, a total of 54 of the hedge funds we track were long in this stock, a change of 15% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were boosting their stakes considerably.
According to our comprehensive database, David Einhorn’s Greenlight Capital had the biggest position in Aetna Inc. (NYSE:AET), worth close to $332.8 million, accounting for 5.1% of its total 13F portfolio. The second largest stake is held by John Paulson of Paulson & Co, with a $332.3 million position; 1.9% of its 13F portfolio is allocated to the company. Other hedge funds with similar optimism include Daniel S. Och’s OZ Management, Barry Rosenstein’s JANA Partners and William B. Gray’s Orbis Investment Management.
Now, specific money managers were breaking ground themselves. Viking Global, managed by Andreas Halvorsen, assembled the biggest position in Aetna Inc. (NYSE:AET). Viking Global had 65.6 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made a $52.1 million investment in the stock during the quarter. The following funds were also among the new AET investors: SAC Subsidiary’s CR Intrinsic Investors, Dmitry Balyasny’s Balyasny Asset Management, and Curtis Schenker and Craig Effron’s Scoggin.
Insider trading activity in Aetna Inc. (NYSE:AET)
Insider trading activity, especially when it’s bullish, is most useful when the primary stock in question has seen transactions within the past half-year. Over the last half-year time frame, Aetna Inc. (NYSE:AET) has experienced 1 unique insiders purchasing, and 7 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Aetna Inc. (NYSE:AET). These stocks are Express Scripts Holding Company (NASDAQ:ESRX), Coventry Health Care, Inc. (NYSE:CVH), Humana Inc (NYSE:HUM), WellPoint, Inc. (NYSE:WLP), and CIGNA Corporation (NYSE:CI). This group of stocks belong to the health care plans industry and their market caps are closest to AET’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Express Scripts Holding Company (NASDAQ:ESRX) | 68 | 1 | 6 |
| Coventry Health Care, Inc. (NYSE:CVH) | 32 | 0 | 10 |
| Humana Inc (NYSE:HUM) | 36 | 0 | 6 |
| WellPoint, Inc. (NYSE:WLP) | 44 | 0 | 8 |
| CIGNA Corporation (NYSE:CI) | 42 | 1 | 6 |
With the returns exhibited by our time-tested strategies, retail investors should always keep an eye on hedge fund and insider trading activity, and Aetna Inc. (NYSE:AET) is no exception.
