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Agrium Inc. (USA) (AGU): Hedge Funds Are Bearish and Insiders Are Undecided, What Should You Do?

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In the 21st century investor’s toolkit, there are tons of indicators investors can use to analyze Mr. Market. Some of the most underrated are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top fund managers can trounce the market by a superb margin (see just how much).

Just as crucial, positive insider trading activity is a second way to look at the financial markets. Obviously, there are plenty of motivations for a bullish insider to get rid of shares of his or her company, but just one, very simple reason why they would behave bullishly. Many empirical studies have demonstrated the impressive potential of this tactic if you understand what to do (learn more here).

Now that that’s out of the way, we’re going to discuss the newest info for Agrium Inc. (USA) (NYSE:AGU).

Agrium Inc. (USA) (NYSE:AGU)

How are hedge funds trading Agrium Inc. (USA) (NYSE:AGU)?

Heading into Q3, a total of 23 of the hedge funds we track were bullish in this stock, a change of -18% from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings considerably.

When using filings from the hedgies we track, JANA Partners, managed by Barry Rosenstein, holds the most valuable position in Agrium Inc. (USA) (NYSE:AGU). JANA Partners has a $985.2 million position in the stock, comprising 13.9% of its 13F portfolio. Sitting at the No. 2 spot is D E Shaw, managed by D. E. Shaw, which held a $73.9 million position; 0.1% of its 13F portfolio is allocated to the stock. Some other hedge funds that hold long positions include Jim Simons’s Renaissance Technologies, Richard Chilton’s Chilton Investment Company and D. E. Shaw’s D E Shaw.

Due to the fact Agrium Inc. (USA) (NYSE:AGU) has witnessed dropping sentiment from the entirety of the hedge funds we track, we can see that there lies a certain “tier” of hedgies who sold off their entire stakes in Q1. It’s worth mentioning that Dan Loeb’s Third Point cut the largest stake of the “upper crust” of funds we watch, totaling about $97.5 million in stock, and Daniel Bubis of Tetrem Capital Management was right behind this move, as the fund dumped about $42.5 million worth. These transactions are important to note, as total hedge fund interest dropped by 5 funds in Q1.

How are insiders trading Agrium Inc. (USA) (NYSE:AGU)?

Legal insider trading, particularly when it’s bullish, is at its handiest when the company in focus has seen transactions within the past half-year. Over the latest half-year time period, Agrium Inc. (USA) (NYSE:AGU) has seen zero unique insiders buying, and zero 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 Agrium Inc. (USA) (NYSE:AGU). These stocks are Terra Nitrogen Company, L.P. (NYSE:TNH), Syngenta AG (ADR) (NYSE:SYT), Potash Corp./Saskatchewan (USA) (NYSE:POT), Mosaic Co (NYSE:MOS), and CF Industries Holdings, Inc. (NYSE:CF). This group of stocks belong to the agricultural chemicals industry and their market caps resemble AGU’s market cap.

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