Should You Buy Tyson Foods, Inc. (TSN)?

Is Tyson Foods, Inc. (NYSE:TSN) a buy?

In the financial world, there are many methods shareholders can use to analyze the equity markets. Some of the most underrated are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top hedge fund managers can trounce the S&P 500 by a healthy amount (see just how much).

Just as useful, optimistic insider trading sentiment is a second way to look at the financial markets. As the old adage goes: there are plenty of reasons for an upper level exec to get rid of shares of his or her company, but just one, very clear reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the valuable potential of this strategy if shareholders understand what to do (learn more here).

Keeping this in mind, let’s analyze the recent info for Tyson Foods, Inc. (NYSE:TSN).

What does the smart money think about Tyson Foods, Inc. (NYSE:TSN)?

Heading into Q3, a total of 29 of the hedge funds we track were bullish in this stock, a change of 16% from the first quarter. With hedgies’ capital changing hands, there exists a few noteworthy hedge fund managers who were increasing their stakes substantially.

According to our 13F database, PEAK6 Capital Management, managed by Matthew Hulsizer, holds the most valuable position in Tyson Foods, Inc. (NYSE:TSN). PEAK6 Capital Management has a $1.191 billion position in the stock, comprising 4.5% of its 13F portfolio. Coming in second is AQR Capital Management, managed by Cliff Asness, which held a $127.2 million position; 0.5% of its 13F portfolio is allocated to the stock. Other hedgies with similar optimism include Steven Cohen’s SAC Capital Advisors, Peter Rathjens Bruce Clarke and John Campbell’s Arrowstreet Capital and Michael Messner’s Seminole Capital (Investment Mgmt).

As industrywide interest increased, certain money managers were breaking ground themselves. PEAK6 Capital Management, managed by Matthew Hulsizer, established the most outsized position in Tyson Foods, Inc. (NYSE:TSN). PEAK6 Capital Management had 1.191 billion invested in the company at the end of the quarter. Cliff Asness’s AQR Capital Management also made a $127.2 million investment in the stock during the quarter. The following funds were also among the new TSN investors: Steven Cohen’s SAC Capital Advisors, Peter Rathjens Bruce Clarke and John Campbell’s Arrowstreet Capital, and Michael Messner’s Seminole Capital (Investment Mgmt).

What have insiders been doing with Tyson Foods, Inc. (NYSE:TSN)?

Insider buying made by high-level executives is particularly usable when the company we’re looking at has experienced transactions within the past half-year. Over the latest half-year time period, Tyson Foods, Inc. (NYSE:TSN) has seen 2 unique insiders purchasing, and 6 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 Tyson Foods, Inc. (NYSE:TSN). These stocks are Seaboard Corporation (NYSEAMEX:SEB), Smithfield Foods, Inc. (NYSE:SFD), BRF Brasil Foods SA (ADR) (NYSE:BRFS), Leucadia National Corp. (NYSE:LUK), and Hormel Foods Corporation (NYSE:HRL). This group of stocks are the members of the meat products industry and their market caps are similar to TSN’s market cap.