Is Park Electrochemical Corp. (NYSE:PKE) undervalued? Prominent investors are in a bullish mood. The number of long hedge fund bets moved up by 1 recently.
According to most traders, hedge funds are viewed as worthless, outdated investment vehicles of years past. While there are greater than 8000 funds in operation at present, we hone in on the bigwigs of this club, about 450 funds. It is estimated that this group has its hands on the lion’s share of all hedge funds’ total capital, and by watching their highest performing investments, we have spotted a few investment strategies that have historically outpaced the broader indices. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points annually 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 trumped the S&P 500 index by 24 percentage points in 7 months (see all of our picks from August).
Equally as key, optimistic insider trading sentiment is a second way to parse down the world of equities. There are many reasons for an insider to get rid of shares of his or her company, but just one, very clear reason why they would buy. Plenty of empirical studies have demonstrated the impressive potential of this method if investors know what to do (learn more here).
Now, it’s important to take a look at the recent action regarding Park Electrochemical Corp. (NYSE:PKE).
What have hedge funds been doing with Park Electrochemical Corp. (NYSE:PKE)?
At the end of the fourth quarter, a total of 7 of the hedge funds we track were bullish in this stock, a change of 17% from one quarter earlier. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were increasing their holdings meaningfully.
Of the funds we track, Royce & Associates, managed by Chuck Royce, holds the biggest position in Park Electrochemical Corp. (NYSE:PKE). Royce & Associates has a $77.6 million position in the stock, comprising 0.3% of its 13F portfolio. On Royce & Associates’s heels is Jim Simons of Renaissance Technologies, with a $16.5 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other hedge funds that are bullish include Mario Gabelli’s GAMCO Investors, Martin Whitman’s Third Avenue Management and Joel Greenblatt’s Gotham Asset Management.
Now, some big names were breaking ground themselves. Two Sigma Advisors, managed by John Overdeck and David Siegel, initiated the most valuable position in Park Electrochemical Corp. (NYSE:PKE). Two Sigma Advisors had 0.3 million invested in the company at the end of the quarter.
How are insiders trading Park Electrochemical Corp. (NYSE:PKE)?
Bullish insider trading is best served when the company in question has seen transactions within the past 180 days. Over the last six-month time period, Park Electrochemical Corp. (NYSE:PKE) has seen 1 unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Park Electrochemical Corp. (NYSE:PKE). These stocks are Kimball International (NASDAQ:KBALB), Benchmark Electronics, Inc. (NYSE:BHE), Plexus Corp. (NASDAQ:PLXS), Multi-Fineline Electronix, Inc. (NASDAQ:MFLX), and TTM Technologies, Inc. (NASDAQ:TTMI). This group of stocks are the members of the printed circuit boards industry and their market caps resemble PKE’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Kimball International (NASDAQ:KBALB) | 10 | 0 | 0 |
| Benchmark Electronics, Inc. (NYSE:BHE) | 13 | 0 | 4 |
| Plexus Corp. (NASDAQ:PLXS) | 10 | 0 | 1 |
| Multi-Fineline Electronix, Inc. (NASDAQ:MFLX) | 7 | 0 | 0 |
| TTM Technologies, Inc. (NASDAQ:TTMI) | 8 | 0 | 5 |
With the results exhibited by the aforementioned strategies, retail investors must always keep an eye on hedge fund and insider trading activity, and Park Electrochemical Corp. (NYSE:PKE) is an important part of this process.
