Does this data mean Weatherford International Ltd (NYSE:WFT) is a sell?
In the 21st century investor’s toolkit, there are many indicators shareholders can use to watch stocks. Two of the most innovative are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top investment managers can trounce the broader indices by a healthy amount (see just how much).
Equally as key, positive insider trading sentiment is another way to analyze the marketplace. Just as you'd expect, there are plenty of incentives for an insider to drop shares of his or her company, but just one, very simple reason why they would buy. Several empirical studies have demonstrated the market-beating potential of this tactic if investors understand what to do (learn more here).
Now that that's out of the way, it's important to discuss the latest info for Weatherford International Ltd (NYSE:WFT).
At Q2's end, a total of 28 of the hedge funds we track held long positions in this stock, a change of -20% from the previous quarter. With hedge funds' sentiment swirling, there exists a select group of noteworthy hedge fund managers who were upping their stakes significantly.
Judging by the fact that Weatherford International Ltd (NYSE:WFT) has witnessed bearish sentiment from the entirety of the hedge funds we track, we can see that there exists a select few hedgies that elected to cut their full holdings in Q1. At the top of the heap, Doug Silverman and Alexander Klabin's Senator Investment Group sold off the largest investment of the "upper crust" of funds we track, comprising close to $97.1 million in stock. Jeffrey Vinik's fund, Vinik Asset Management, also dumped its stock, about $34.2 million worth. These bearish behaviors are important to note, as total hedge fund interest fell by 7 funds in Q1.
Insider buying is most useful when the company in focus has experienced transactions within the past 180 days. Over the latest six-month time frame, Weatherford International Ltd (NYSE:WFT) has seen 1 unique insiders buying, and 3 insider sales (see the details of insider trades here).
We'll check out the relationship between both of these indicators in other stocks similar to Weatherford International Ltd (NYSE:WFT). These stocks are MDU Resources Group Inc (NYSE:MDU), Cameron International Corporation (NYSE:CAM), Core Laboratories N.V. (NYSE:CLB), FMC Technologies, Inc. (NYSE:FTI), and Oceaneering International (NYSE:OII). This group of stocks belong to the oil & gas equipment & services industry and their market caps match WFT's market cap.