The Jones Group Inc. (JNY): Are Hedge Funds Right About This Stock? – Stage Stores Inc (SSI), Jos. A. Bank Clothiers Inc (JOSB)

The Jones Group Inc. (NYSE:JNY) was in 13 hedge funds’ portfolio at the end of December. JNY investors should be aware of an increase in hedge fund interest in recent months. There were 10 hedge funds in our database with JNY holdings at the end of the previous quarter.

If you’d ask most investors, hedge funds are seen as unimportant, old financial vehicles of years past. While there are greater than 8000 funds trading at present, we hone in on the aristocrats of this club, about 450 funds. It is widely believed that this group oversees most of the hedge fund industry’s total asset base, and by paying attention to their top picks, we have revealed a few investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per year for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have outpaced the S&P 500 index by 24 percentage points in 7 months (explore the details and some picks here).

Equally as key, bullish insider trading sentiment is a second way to parse down the world of equities. As the old adage goes: there are a number of incentives for an upper level exec to sell shares of his or her company, but just one, very clear reason why they would behave bullishly. Many academic studies have demonstrated the useful potential of this strategy if piggybackers know where to look (learn more here).

Now, it’s important to take a peek at the key action encompassing The Jones Group Inc. (NYSE:JNY).

What have hedge funds been doing with The Jones Group Inc. (NYSE:JNY)?

In preparation for this year, a total of 13 of the hedge funds we track were long in this stock, a change of 30% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were boosting their stakes meaningfully.

According to our comprehensive database, Pzena Investment Management, managed by Richard S. Pzena, holds the most valuable position in The Jones Group Inc. (NYSE:JNY). Pzena Investment Management has a $27 million position in the stock, comprising 0.2% of its 13F portfolio. Coming in second is Dreman Value Management, managed by David Dreman, which held a $25.5 million position; the fund has 0.7% of its 13F portfolio invested in the stock. Remaining hedge funds that hold long positions include Chuck Royce’s Royce & Associates, Ken Griffin’s Citadel Investment Group and Glenn Russell Dubin’s Highbridge Capital Management.

As one would reasonably expect, key money managers were breaking ground themselves. Citadel Investment Group, managed by Ken Griffin, established the most outsized position in The Jones Group Inc. (NYSE:JNY). Citadel Investment Group had 3 million invested in the company at the end of the quarter. Glenn Russell Dubin’s Highbridge Capital Management also initiated a $2.6 million position during the quarter. The other funds with brand new JNY positions are Paul Tudor Jones’s Tudor Investment Corp, Ken Gray and Steve Walsh’s Bryn Mawr Capital, and Israel Englander’s Catapult Capital Management.

What do corporate executives and insiders think about The Jones Group Inc. (NYSE:JNY)?

Insider trading activity, especially when it’s bullish, is most useful when the primary stock in question has seen transactions within the past half-year. Over the last half-year time period, The Jones Group Inc. (NYSE:JNY) has experienced zero unique insiders buying, and 3 insider sales (see the details of insider trades here).

Let’s also take a look at hedge fund and insider activity in other stocks similar to The Jones Group Inc. (NYSE:JNY). These stocks are Ann Inc (NYSE:ANN), Stage Stores Inc (NYSE:SSI), Jos. A. Bank Clothiers Inc (NASDAQ:JOSB), Aeropostale, Inc. (NYSE:ARO), and Children’s Place Retail Stores, Inc. (NASDAQ:PLCE). This group of stocks belong to the apparel stores industry and their market caps are closest to JNY’s market cap.