Verint Systems Inc. (VRNT): Hedge Funds Are Bullish and Insiders Are Bearish, What Should You Do?

Verint Systems Inc. (NASDAQ:VRNT) was in 29 hedge funds’ portfolio at the end of March. VRNT has seen an increase in support from the world’s most elite money managers recently. There were 22 hedge funds in our database with VRNT holdings at the end of the previous quarter.

In the 21st century investor’s toolkit, there are a multitude of metrics shareholders can use to monitor the equity markets. 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 top picks of the top investment managers can outclass their index-focused peers by a significant margin (see just how much).

Just as beneficial, bullish insider trading sentiment is a second way to parse down the financial markets. There are plenty of reasons for an upper level exec to sell shares of his or her company, but just one, very clear reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the impressive potential of this method if “monkeys” understand where to look (learn more here).

Now, it’s important to take a look at the latest action encompassing Verint Systems Inc. (NASDAQ:VRNT).

How are hedge funds trading Verint Systems Inc. (NASDAQ:VRNT)?

Heading into Q2, a total of 29 of the hedge funds we track were bullish in this stock, a change of 32% from one quarter earlier. With hedgies’ capital changing hands, there exists a select group of noteworthy hedge fund managers who were increasing their holdings considerably.

Of the funds we track, Eric Bannasch’s Cadian Capital had the biggest position in Verint Systems Inc. (NASDAQ:VRNT), worth close to $156.1 million, comprising 4.3% of its total 13F portfolio. Coming in second is Robert Pitts of Steadfast Capital Management, with a $71.8 million position; 1.9% of its 13F portfolio is allocated to the company. Some other peers with similar optimism include Clifton S. Robbins’s Blue Harbour Group, Michael Doheny’s Freshford Capital Management and Andrew Feldstein and Stephen Siderow’s Blue Mountain Capital.

As aggregate interest increased, key hedge funds have been driving this bullishness. SAC Capital Advisors, managed by Steven Cohen, created the most valuable position in Verint Systems Inc. (NASDAQ:VRNT). SAC Capital Advisors had 24.1 million invested in the company at the end of the quarter. Josh Resnick’s Jericho Capital Asset Management also initiated a $20.2 million position during the quarter. The other funds with brand new VRNT positions are George Soros’s Soros Fund Management, Malcolm Fairbairn’s Ascend Capital, and Michael A. Price and Amos Meron’s Empyrean Capital Partners.

How are insiders trading Verint Systems Inc. (NASDAQ:VRNT)?

Bullish insider trading is particularly usable when the company in focus has experienced transactions within the past 180 days. Over the latest six-month time period, Verint Systems Inc. (NASDAQ:VRNT) has seen zero unique insiders buying, and 6 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Verint Systems Inc. (NASDAQ:VRNT). These stocks are SS and C Technologies Holdings Inc (NASDAQ:SSNC), Qlik Technologies Inc (NASDAQ:QLIK), Sapient Corporation (NASDAQ:SAPE), Guidewire Software Inc (NYSE:GWRE), and Convergys Corporation (NYSE:CVG). All of these stocks are in the business software & services industry and their market caps match VRNT’s market cap.

With the results demonstrated by the aforementioned studies, retail investors must always watch hedge fund and insider trading sentiment, and Verint Systems Inc. (NASDAQ:VRNT) is no exception.

Click here to learn why you should track hedge funds