This Metric Says You Are Smart to Sell Emcor Group Inc (EME)

Emcor Group Inc (NYSE:EME) shareholders have witnessed a decrease in activity from the world’s largest hedge funds recently.

In today’s marketplace, there are a multitude of methods investors can use to track publicly traded companies. Some of the most under-the-radar are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top money managers can outperform the S&P 500 by a solid margin (see just how much).

Equally as important, bullish insider trading activity is another way to parse down the investments you’re interested in. There are lots of stimuli for an upper level exec to sell shares of his or her company, but only one, very obvious reason why they would behave bullishly. Plenty of empirical studies have demonstrated the market-beating potential of this strategy if you understand what to do (learn more here).

With these “truths” under our belt, let’s take a gander at the latest action regarding Emcor Group Inc (NYSE:EME).

What have hedge funds been doing with Emcor Group Inc (NYSE:EME)?

At Q1’s end, a total of 20 of the hedge funds we track were bullish in this stock, a change of 0% from one quarter earlier. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were upping their holdings significantly.

When looking at the hedgies we track, Royce & Associates, managed by Chuck Royce, holds the largest position in Emcor Group Inc (NYSE:EME). Royce & Associates has a $157.2 million position in the stock, comprising 0.5% of its 13F portfolio. The second largest stake is held by Adage Capital Management, managed by Phill Gross and Robert Atchinson, which held a $67.9 million position; 0.2% of its 13F portfolio is allocated to the stock. Some other hedgies with similar optimism include Martin Whitman’s Third Avenue Management, Cliff Asness’s AQR Capital Management and David Dreman’s Dreman Value Management.

Because Emcor Group Inc (NYSE:EME) has witnessed falling interest from hedge fund managers, it’s safe to say that there lies a certain “tier” of money managers that elected to cut their full holdings last quarter. At the top of the heap, Alexander Medina Seaver’s Stadium Capital Management said goodbye to the biggest stake of all the hedgies we watch, totaling close to $12.6 million in stock.. Jeffrey Vinik’s fund, Vinik Asset Management, also said goodbye to its stock, about $1.3 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

How are insiders trading Emcor Group Inc (NYSE:EME)?

Insider purchases made by high-level executives is best served when the company in question has seen transactions within the past half-year. Over the latest 180-day time frame, Emcor Group Inc (NYSE:EME) has experienced zero unique insiders purchasing, and 8 insider sales (see the details of insider trades here).

Let’s also examine hedge fund and insider activity in other stocks similar to Emcor Group Inc (NYSE:EME). These stocks are Pike Electric Corporation (NYSE:PIKE), MYR Group Inc (NASDAQ:MYRG), Comfort Systems USA, Inc. (NYSE:FIX), Chicago Bridge & Iron Company N.V. (NYSE:CBI), and Quanta Services Inc (NYSE:PWR). This group of stocks belong to the general contractors industry and their market caps are closest to EME’s market cap.