Should You Buy KEMET Corporation (KEM)?

Should KEMET Corporation (NYSE:KEM) investors track the following data?

In the 21st century investor’s toolkit, there are tons of metrics market participants can use to track stocks. A couple of the most under-the-radar are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top fund managers can outclass the broader indices by a very impressive margin (see just how much).

Just as necessary, positive insider trading sentiment is another way to analyze the financial markets. There are lots of motivations for a corporate insider to downsize shares of his or her company, but only one, very simple reason why they would behave bullishly. Various empirical studies have demonstrated the valuable potential of this method if piggybackers understand where to look (learn more here).

Keeping this in mind, let’s examine the newest info for KEMET Corporation (NYSE:KEM).

What have hedge funds been doing with KEMET Corporation (NYSE:KEM)?

At the end of the second quarter, a total of 6 of the hedge funds we track held long positions in this stock, a change of 20% from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were upping their holdings considerably.

When using filings from the hedgies we track, Eric Bannasch’s Cadian Capital had the most valuable position in KEMET Corporation (NYSE:KEM), worth close to $17 million, accounting for 0.5% of its total 13F portfolio. Coming in second is Chuck Royce of Royce & Associates, with a $9.3 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining peers that are bullish include Cliff Asness’s AQR Capital Management, Israel Englander’s Millennium Management and Mike Vranos’s Ellington.

As aggregate interest spiked, specific money managers were leading the bulls’ herd. Cadian Capital, managed by Eric Bannasch, assembled the largest position in KEMET Corporation (NYSE:KEM). Cadian Capital had 17 million invested in the company at the end of the quarter. Chuck Royce’s Royce & Associates also initiated a $9.3 million position during the quarter. The following funds were also among the new KEM investors: Cliff Asness’s AQR Capital Management, Israel Englander’s Millennium Management, and Mike Vranos’s Ellington.

How are insiders trading KEMET Corporation (NYSE:KEM)?

Bullish insider trading is particularly usable when the company we’re looking at has seen transactions within the past six months. Over the last half-year time period, KEMET Corporation (NYSE:KEM) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

We’ll also take a look at the relationship between both of these indicators in other stocks similar to KEMET Corporation (NYSE:KEM). These stocks are Neonode, Inc (NASDAQ:NEON), Vicor Corp (NASDAQ:VICR), Silicon Motion Technology Corp. (ADR) (NASDAQ:SIMO), CTS Corporation (NYSE:CTS), and UniPixel Inc (NASDAQ:UNXL). This group of stocks are in the diversified electronics industry and their market caps match KEM’s market cap.