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Eastman Chemical Company (NYSE:EMN): Insiders Are Dumping, Should You?

Eastman Chemical Company (NYSE:EMN) was in 45 hedge funds’ portfolio at the end of December. EMN has experienced an increase in hedge fund interest lately. There were 43 hedge funds in our database with EMN holdings at the end of the previous quarter.

Eastman Chemical

To the average investor, there are a multitude of methods shareholders can use to analyze stocks. A duo of the most innovative are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top investment managers can outperform their index-focused peers by a healthy amount (see just how much).

Equally as key, positive insider trading sentiment is a second way to parse down the financial markets. As the old adage goes: there are a variety of stimuli for a bullish insider to cut shares of his or her company, but only one, very obvious reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the valuable potential of this strategy if “monkeys” 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 Eastman Chemical Company (NYSE:EMN).

How are hedge funds trading Eastman Chemical Company (NYSE:EMN)?

In preparation for this year, a total of 45 of the hedge funds we track were bullish in this stock, a change of 5% from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were boosting their holdings considerably.

Of the funds we track, Andreas Halvorsen’s Viking Global had the largest position in Eastman Chemical Company (NYSE:EMN), worth close to $412 million billion, accounting for 2.9% of its total 13F portfolio. Coming in second is David Cohen and Harold Levy of Iridian Asset Management, with a $299 million position; the fund has 4.9% of its 13F portfolio invested in the stock. Remaining peers with similar optimism include Doug Silverman’s Senator Investment Group, Jean-Marie Eveillard’s First Eagle Investment Management and Daniel S. Och’s OZ Management.

As one would reasonably expect, some big names have jumped into Eastman Chemical Company (NYSE:EMN) headfirst. Capital Growth Management, managed by Ken Heebner, created the most valuable position in Eastman Chemical Company (NYSE:EMN). Capital Growth Management had 16 million invested in the company at the end of the quarter. Phill Gross and Robert Atchinson’s Adage Capital Management also made a $15 million investment in the stock during the quarter. The other funds with brand new EMN positions are Stephen J. Errico’s Locust Wood Capital Advisers, Anand Parekh’s Alyeska Investment Group, and Bruce Kovner’s Caxton Associates LP.

How are insiders trading Eastman Chemical Company (NYSE:EMN)?

Insider buying is at its handiest when the company in focus has experienced transactions within the past half-year. Over the last half-year time period, Eastman Chemical Company (NYSE:EMN) has seen zero unique insiders buying, and 9 insider sales (see the details of insider trades here).

With the returns demonstrated by the aforementioned tactics, everyday investors must always keep an eye on hedge fund and insider trading activity, and Eastman Chemical Company (NYSE:EMN) applies perfectly to this mantra.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.

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