United Parcel Service, Inc. (UPS): Are Hedge Funds Right About This Stock?

Is United Parcel Service, Inc. (NYSE:UPS) a buy?

To the average investor, there are many methods market participants can use to watch their holdings. Some 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 fund managers can outclass the broader indices by a very impressive amount (see just how much).

Just as useful, optimistic insider trading activity is another way to look at the marketplace. Just as you’d expect, there are lots of incentives for an upper level exec to drop shares of his or her company, but only one, very clear reason why they would buy. Various empirical studies have demonstrated the impressive potential of this strategy if shareholders understand what to do (learn more here).

What’s more, we’re going to study the newest info about United Parcel Service, Inc. (NYSE:UPS).

Hedge fund activity in United Parcel Service, Inc. (NYSE:UPS)

In preparation for the third quarter, a total of 44 of the hedge funds we track were bullish in this stock, a change of 5% from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were boosting their holdings considerably.

When using filings from the hedgies we track, Jonathon Jacobson’s Highfields Capital Management had the most valuable position in United Parcel Service, Inc. (NYSE:UPS), worth close to $353.5 million, comprising 2.9% of its total 13F portfolio. The second largest stake is held by Edgar Wachenheim of Greenhaven Associates, with a $349 million position; 9.3% of its 13F portfolio is allocated to the company. Other hedgies that hold long positions include James Crichton and Adam Weiss’s Scout Capital Management, Lee Ainslie’s Maverick Capital and Jonathon Jacobson’s Highfields Capital Management.

With a general bullishness amongst the titans, particular hedge funds have jumped into United Parcel Service, Inc. (NYSE:UPS) headfirst. Highfields Capital Management, managed by Jonathon Jacobson, created the most valuable position in United Parcel Service, Inc. (NYSE:UPS). Highfields Capital Management had 353.5 million invested in the company at the end of the quarter. Edgar Wachenheim’s Greenhaven Associates also made a $349 million investment in the stock during the quarter. The other funds with brand new UPS positions are James Crichton and Adam Weiss’s Scout Capital Management, Lee Ainslie’s Maverick Capital, and Jonathon Jacobson’s Highfields Capital Management.

How are insiders trading United Parcel Service, Inc. (NYSE:UPS)?

Insider buying is most useful when the primary stock in question has experienced transactions within the past six months. Over the latest six-month time frame, United Parcel Service, Inc. (NYSE:UPS) has seen zero unique insiders buying, 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 United Parcel Service, Inc. (NYSE:UPS). These stocks are Hub Group Inc (NASDAQ:HUBG), UTi Worldwide Inc. (NASDAQ:UTIW), Expeditors International of Washington (NASDAQ:EXPD), C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW), and FedEx Corporation (NYSE:FDX). This group of stocks are the members of the air delivery & freight services industry and their market caps resemble UPS’s market cap.