Alpha Natural Resources, Inc. (NYSE:ANR) investors should be aware of an increase in support from the world's most elite money managers of late.
In the financial world, there are many indicators investors can use to track publicly traded companies. A duo of the best are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best money managers can outclass their index-focused peers by a significant margin (see just how much).
Just as integral, bullish insider trading activity is a second way to break down the world of equities. As the old adage goes: there are lots of reasons for an insider to sell shares of his or her company, but just one, very clear reason why they would buy. Plenty of empirical studies have demonstrated the valuable potential of this strategy if piggybackers understand what to do (learn more here).
Consequently, let's take a peek at the latest action surrounding Alpha Natural Resources, Inc. (NYSE:ANR).
At year's end, a total of 28 of the hedge funds we track were long in this stock, a change of 8% from the third quarter. With the smart money's capital changing hands, there exists an "upper tier" of key hedge fund managers who were increasing their holdings meaningfully.
Of the funds we track, Michael Johnston's Steelhead Partners had the biggest position in Alpha Natural Resources, Inc. (NYSE:ANR), worth close to $91.4 million, comprising 6.7% of its total 13F portfolio. The second largest stake is held by Paulson & Co, managed by John Paulson, which held a $58.4 million position; the fund has 0.4% of its 13F portfolio invested in the stock. Some other hedge funds with similar optimism include Cliff Asness's AQR Capital Management, D. E. Shaw's D E Shaw and Matthew Halbower's Pentwater Capital Management.
Consequently, specific money managers have jumped into Alpha Natural Resources, Inc. (NYSE:ANR) headfirst. Paulson & Co, managed by John Paulson, initiated the largest position in Alpha Natural Resources, Inc. (NYSE:ANR). Paulson & Co had 58.4 million invested in the company at the end of the quarter. Daniel S. Och's OZ Management also initiated a $7.2 million position during the quarter. The other funds with brand new ANR positions are Anand Parekh's Alyeska Investment Group, Anthony Giammalva's Sound Energy Partners, and John Burbank's Passport Capital.
Insider purchases made by high-level executives is most useful when the company we're looking at has seen transactions within the past six months. Over the latest half-year time frame, Alpha Natural Resources, Inc. (NYSE:ANR) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let's also review hedge fund and insider activity in other stocks similar to Alpha Natural Resources, Inc. (NYSE:ANR). These stocks are Alliance Resource Partners, L.P. (NASDAQ:ARLP), PVR Partners LP (NYSE:PVR), Stillwater Mining Company (NYSE:SWC), HudBay Minerals Inc Ord Shs (NYSE:HBM), and Walter Energy, Inc. (NYSE:WLT). This group of stocks are the members of the industrial metals & minerals industry and their market caps are closest to ANR's market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Alliance Resource Partners, L.P. (NASDAQ:ARLP)||4||1||4|
|PVR Partners LP (NYSE:PVR)||3||4||1|
|Stillwater Mining Company (NYSE:SWC)||17||1||4|
|HudBay Minerals Inc Ord Shs (NYSE:HBM)||5||0||0|
|Walter Energy, Inc. (NYSE:WLT)||30||0||0|
With the returns exhibited by our time-tested strategies, retail investors should always monitor hedge fund and insider trading sentiment, and Alpha Natural Resources, Inc. (NYSE:ANR) is an important part of this process.