Should You Buy Con-way Inc (CNW)?

Is Con-way Inc (NYSE:CNW) a good investment?

If you were to ask many of your peers, hedge funds are perceived as bloated, old investment tools of an era lost to time. Although there are more than 8,000 hedge funds trading in present day, Insider Monkey aim at the upper echelon of this club, about 525 funds. It is widely held that this group controls the majority of all hedge funds’ total capital, and by tracking their highest quality equity investments, we’ve deciphered a few investment strategies that have historically outperformed the market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have outclassed the S&P 500 index by 33 percentage points in 11 months (explore the details and some picks here).

Just as key, optimistic insider trading sentiment is a second way to analyze the stock market universe. There are plenty of motivations for a corporate insider to drop shares of his or her company, but only one, very simple reason why they would initiate a purchase. Plenty of academic studies have demonstrated the valuable potential of this tactic if investors understand where to look (learn more here).

Furthermore, let’s study the newest info about Con-way Inc (NYSE:CNW).

What does the smart money think about Con-way Inc (NYSE:CNW)?

Heading into Q3, a total of 19 of the hedge funds we track were long in this stock, a change of 27% from the first quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were increasing their holdings meaningfully.

According to our 13F database, Richard S. Pzena’s Pzena Investment Management had the largest position in Con-way Inc (NYSE:CNW), worth close to $49 million, accounting for 0.3% of its total 13F portfolio. Sitting at the No. 2 spot is Alexander Mitchell of Scopus Asset Management, with a $41.9 million position; the fund has 1.2% of its 13F portfolio invested in the stock. Remaining hedgies that are bullish include Ken Griffin’s Citadel Investment Group, Robert Bishop’s Impala Asset Management and Frank Brosens’s Taconic Capital.

As industrywide interest increased, certain money managers were breaking ground themselves. Pzena Investment Management, managed by Richard S. Pzena, established the most outsized position in Con-way Inc (NYSE:CNW). Pzena Investment Management had 49 million invested in the company at the end of the quarter. Alexander Mitchell’s Scopus Asset Management also initiated a $41.9 million position during the quarter. The other funds with new positions in the stock are Ken Griffin’s Citadel Investment Group, Robert Bishop’s Impala Asset Management, and Frank Brosens’s Taconic Capital.

Insider trading activity in Con-way Inc (NYSE:CNW)

Insider buying made by high-level executives is most useful when the company in question has seen transactions within the past half-year. Over the latest 180-day time frame, Con-way Inc (NYSE:CNW) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

We’ll go over the relationship between both of these indicators in other stocks similar to Con-way Inc (NYSE:CNW). These stocks are Old Dominion Freight Line (NASDAQ:ODFL), Knight Transportation (NYSE:KNX), Landstar System, Inc. (NASDAQ:LSTR), Werner Enterprises, Inc. (NASDAQ:WERN), and Swift Transportation Co (NYSE:SWFT). This group of stocks belong to the trucking industry and their market caps resemble CNW’s market cap.

Using the returns shown by Insider Monkey’s strategies, regular investors must always watch hedge fund and insider trading activity, and Con-way Inc (NYSE:CNW) applies perfectly to this mantra.

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