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Fastenal Company (FAST): Are Hedge Funds Right About This Stock?

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Now, according to many investors, hedge funds are viewed as bloated, old financial tools of a forgotten age. Although there are In excess of 8,000 hedge funds with their doors open today, this site looks at the elite of this group, around 525 funds. It is assumed that this group has its hands on the majority of all hedge funds’ total capital, and by keeping an eye on their best investments, we’ve found a few investment strategies that have historically beaten Mr. Market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points a year for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have trumped the S&P 500 index by 33 percentage points in 11 months (explore the details and some picks here).

Just as necessary, bullish insider trading sentiment is another way to analyze the world of equities. There are lots of incentives for a bullish insider to cut shares of his or her company, but only one, very simple reason why they would behave bullishly. Several empirical studies have demonstrated the impressive potential of this method if “monkeys” know where to look (learn more here).

Thus, it’s important to analyze the recent info for Fastenal Company (NASDAQ:FAST).

Hedge fund activity in Fastenal Company (NASDAQ:FAST)

At Q2’s end, a total of 17 of the hedge funds we track held long positions in this stock, a change of 13% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were upping their holdings significantly.

Fastenal Company (NASDAQ:FAST)Out of the hedge funds we follow, Jim Simons’s Renaissance Technologies had the most valuable position in Fastenal Company (NASDAQ:FAST), worth close to $34.5 million, accounting for 0.1% of its total 13F portfolio. Coming in second is Adage Capital Management, managed by Phill Gross and Robert Atchinson, which held a $14.9 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining hedge funds with similar optimism include Matthew Hulsizer’s PEAK6 Capital Management, Cliff Asness’s AQR Capital Management and Israel Englander’s Millennium Management.

As aggregate interest spiked, specific money managers have been driving this bullishness. Renaissance Technologies, managed by Jim Simons, assembled the most outsized position in Fastenal Company (NASDAQ:FAST). Renaissance Technologies had 34.5 million invested in the company at the end of the quarter. Phill Gross and Robert Atchinson’s Adage Capital Management also made a $14.9 million investment in the stock during the quarter. The following funds were also among the new FAST investors: Matthew Hulsizer’s PEAK6 Capital Management, Cliff Asness’s AQR Capital Management, and Israel Englander’s Millennium Management.

What have insiders been doing with Fastenal Company (NASDAQ:FAST)?

Bullish insider trading is best served when the company we’re looking at has seen transactions within the past six months. Over the latest half-year time period, Fastenal Company (NASDAQ:FAST) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

We’ll also take a look at the relationship between both of these indicators in other stocks similar to Fastenal Company (NASDAQ:FAST). These stocks are Armstrong World Industries, Inc. (NYSE:AWI), Martin Marietta Materials, Inc. (NYSE:MLM), Owens Corning (NYSE:OC), Vulcan Materials Company (NYSE:VMC), and Masco Corporation (NYSE:MAS). This group of stocks are the members of the general building materials industry and their market caps match FAST’s market cap.

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