Should You Sell SHFL entertainment Inc (SHFL)?

Is it smart to be bullish on SHFL entertainment Inc (NASDAQ:SHFL)?

In the financial world, there are dozens of indicators shareholders can use to track their holdings. A pair of the most under-the-radar are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite fund managers can beat their index-focused peers by a solid amount (see just how much).

Just as useful, positive insider trading sentiment is a second way to analyze the world of equities. As the old adage goes: there are plenty of incentives for a bullish insider to get rid of shares of his or her company, but only one, very simple reason why they would behave bullishly. Several empirical studies have demonstrated the market-beating potential of this method if shareholders understand what to do (learn more here).

What’s more, it’s important to analyze the newest info for SHFL entertainment Inc (NASDAQ:SHFL).

Hedge fund activity in SHFL entertainment Inc (NASDAQ:SHFL)

Heading into Q3, a total of 14 of the hedge funds we track were long in this stock, a change of 0% from one quarter earlier. With the smart money’s sentiment swirling, there exists a few notable hedge fund managers who were upping their holdings meaningfully.

Out of the hedge funds we follow, Roberto Mignone’s Bridger Management had the largest position in SHFL entertainment Inc (NASDAQ:SHFL), worth close to $48.7 million, accounting for 3.6% of its total 13F portfolio. On Bridger Management’s heels is Joel Ramin of 12 West Capital Management, with a $18.6 million position; 2.9% of its 13F portfolio is allocated to the stock. Remaining hedge funds that are bullish include Jeffrey Jon Berney’s TriOaks Capital Management, Gregory A. Weaver’s Invicta Capital Management and John Wu’s Sureview Capital.

Due to the fact SHFL entertainment Inc (NASDAQ:SHFL) has witnessed declining interest from the smart money’s best and brightest, we can see that there exists a select few hedge funds that decided to sell off their full holdings last quarter. It’s worth mentioning that Joel Greenblatt’s Gotham Asset Management dumped the biggest stake of the 450+ funds we key on, worth an estimated $0.5 million in stock. Jeffrey Vinik’s fund, Vinik Asset Management, also sold off its stock, about $0.5 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

How have insiders been trading SHFL entertainment Inc (NASDAQ:SHFL)?

Legal insider trading, particularly when it’s bullish, is particularly usable when the primary stock in question has seen transactions within the past 180 days. Over the latest six-month time period, SHFL entertainment Inc (NASDAQ:SHFL) has experienced zero unique insiders purchasing, 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 SHFL entertainment Inc (NASDAQ:SHFL). These stocks are A.T. Cross Company (NASDAQ:ATX), Brunswick Corporation (NYSE:BC), Steinway Musical Instruments Inc (NYSE:LVB), Manchester United PLC (NYSE:MANU), and Movado Group, Inc (NYSE:MOV). This group of stocks are in the recreational goods, other industry and their market caps resemble SHFL’s market cap.