Dresser-Rand Group Inc. (NYSE:DRC) investors should be aware of an increase in activity from the world’s largest hedge funds lately.
In the eyes of most shareholders, hedge funds are perceived as unimportant, old investment tools of the past. While there are more than 8000 funds with their doors open today, we at Insider Monkey choose to focus on the crème de la crème of this group, close to 450 funds. It is estimated that this group controls most of the hedge fund industry’s total asset base, and by monitoring their best stock picks, we have revealed a number of investment strategies that have historically beaten the S&P 500 index. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have topped the S&P 500 index by 23.3 percentage points in 8 months (see the details here).
Equally as key, bullish insider trading sentiment is a second way to break down the world of equities. Just as you’d expect, there are a variety of incentives for a corporate insider to sell shares of his or her company, but just one, very clear reason why they would initiate a purchase. Several academic studies have demonstrated the impressive potential of this method if you know where to look (learn more here).
With all of this in mind, we’re going to take a glance at the latest action regarding Dresser-Rand Group Inc. (NYSE:DRC).
What does the smart money think about Dresser-Rand Group Inc. (NYSE:DRC)?
At Q1’s end, a total of 16 of the hedge funds we track held long positions in this stock, a change of 60% from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were upping their stakes meaningfully.
According to our comprehensive database, Iridian Asset Management, managed by David Cohen and Harold Levy, holds the biggest position in Dresser-Rand Group Inc. (NYSE:DRC). Iridian Asset Management has a $223 million position in the stock, comprising 3.3% of its 13F portfolio. Sitting at the No. 2 spot is First Eagle Investment Management, managed by Jean-Marie Eveillard, which held a $50.6 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Other hedgies that are bullish include Phill Gross and Robert Atchinson’s Adage Capital Management, John A. Levin’s Levin Capital Strategies and Ken Griffin’s Citadel Investment Group.
With a general bullishness amongst the heavyweights, some big names have been driving this bullishness. Pine River Capital Management, managed by Brian Taylor, established the biggest position in Dresser-Rand Group Inc. (NYSE:DRC). Pine River Capital Management had 11.5 million invested in the company at the end of the quarter. Jim Simons’s Renaissance Technologies also made a $11.1 million investment in the stock during the quarter. The other funds with new positions in the stock are Paul Marshall and Ian Wace’s Marshall Wace LLP, SAC Subsidiary’s CR Intrinsic Investors, and Israel Englander’s Millennium Management.
What do corporate executives and insiders think about Dresser-Rand Group Inc. (NYSE:DRC)?
Insider buying is best served when the company in focus has experienced transactions within the past half-year. Over the last six-month time frame, Dresser-Rand Group Inc. (NYSE:DRC) has seen 1 unique insiders buying, and 7 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Dresser-Rand Group Inc. (NYSE:DRC). These stocks are Nordson Corporation (NASDAQ:NDSN), Xylem Inc (NYSE:XYL), Avery Dennison Corp (NYSE:AVY), Colfax Corp (NYSE:CFX), and IDEX Corporation (NYSE:IEX). This group of stocks are in the diversified machinery industry and their market caps match DRC’s market cap.