TE Connectivity Ltd. (NYSE:TEL) investors should be aware of a decrease in support from the world’s most elite money managers lately.
In the financial world, there are tons of gauges investors can use to watch their holdings. Two of the best are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top investment managers can trounce the broader indices by a healthy margin (see just how much).
Equally as integral, bullish insider trading activity is a second way to break down the financial markets. As the old adage goes: there are a variety of reasons for an executive to sell shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Many empirical studies have demonstrated the useful potential of this method if shareholders know where to look (learn more here).
With these “truths” under our belt, let’s take a glance at the recent action regarding TE Connectivity Ltd. (NYSE:TEL).
What does the smart money think about TE Connectivity Ltd. (NYSE:TEL)?
In preparation for this year, a total of 21 of the hedge funds we track were long in this stock, a change of -19% from one quarter earlier. With hedge funds’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes meaningfully.
When looking at the hedgies we track, Richard S. Pzena’s Pzena Investment Management had the most valuable position in TE Connectivity Ltd. (NYSE:TEL), worth close to $403.9 million, comprising 3.3% of its total 13F portfolio. The second largest stake is held by Edgar Wachenheim of Greenhaven Associates, with a $144.5 million position; the fund has 4.4% of its 13F portfolio invested in the stock. Other hedgies that hold long positions include Lou Simpson’s SQ Advisors, Ken Griffin’s Citadel Investment Group and Martin D. Sass’s MD Sass.
Judging by the fact that TE Connectivity Ltd. (NYSE:TEL) has experienced a declination in interest from the smart money, it’s safe to say that there lies a certain “tier” of money managers who sold off their entire stakes heading into 2013. It’s worth mentioning that Robert Emil Zoellner’s Alpine Associates cut the biggest position of all the hedgies we key on, totaling an estimated $48.4 million in stock.. Phill Gross and Robert Atchinson’s fund, Adage Capital Management, also sold off its stock, about $13.7 million worth. These moves are important to note, as total hedge fund interest dropped by 5 funds heading into 2013.
How have insiders been trading TE Connectivity Ltd. (NYSE:TEL)?
Insider trading activity, especially when it’s bullish, is particularly usable when the primary stock in question has seen transactions within the past half-year. Over the last 180-day time frame, TE Connectivity Ltd. (NYSE:TEL) has experienced zero unique insiders buying, and 12 insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to TE Connectivity Ltd. (NYSE:TEL). These stocks are Molex Incorporated (NASDAQ:MOLX), LG Display Co Ltd. (ADR) (NYSE:LPL), Amphenol Corporation (NYSE:APH), Corning Incorporated (NYSE:GLW), and Kyocera Corporation (ADR) (NYSE:KYO). All of these stocks are in the diversified electronics industry and their market caps match TEL’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Molex Incorporated (NASDAQ:MOLX) | 16 | 0 | 0 |
| LG Display Co Ltd. (ADR) (NYSE:LPL) | 9 | 0 | 0 |
| Amphenol Corporation (NYSE:APH) | 16 | 0 | 13 |
| Corning Incorporated (NYSE:GLW) | 39 | 2 | 0 |
| Kyocera Corporation (ADR) (NYSE:KYO) | 2 | 0 | 0 |
With the returns shown by our time-tested strategies, retail investors should always keep an eye on hedge fund and insider trading activity, and TE Connectivity Ltd. (NYSE:TEL) is no exception.
