Hawaiian Telcom HoldCo Inc (NASDAQ:HCOM) was in 9 hedge funds' portfolio at the end of December. There were 9 hedge funds in our database with HCOM holdings at the end of the previous quarter; this is a bearish indicator in our experience.
According to most traders, hedge funds are seen as underperforming, old financial vehicles of the past. While there are over 8000 funds in operation at present, we at Insider Monkey choose to focus on the masters of this club, around 450 funds. Most estimates calculate that this group has its hands on the majority of all hedge funds' total asset base, and by tracking their top equity investments, we have found a few investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per annum 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 beaten the S&P 500 index by 24 percentage points in 7 months (see the details here).
Just as integral, positive insider trading activity is another way to parse down the financial markets. There are many stimuli for an upper level exec to drop shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Various academic studies have demonstrated the market-beating potential of this method if shareholders know where to look (learn more here).
With these "truths" under our belt, we're going to take a glance at the latest action surrounding Hawaiian Telcom HoldCo Inc (NASDAQ:HCOM).
At year's end, a total of 9 of the hedge funds we track were bullish in this stock, a change of 0% from the previous quarter. With the smart money's sentiment swirling, there exists an "upper tier" of noteworthy hedge fund managers who were upping their stakes significantly.
According to our comprehensive database, Brett Hendrickson's Nokomis Capital had the biggest position in Hawaiian Telcom HoldCo Inc (NASDAQ:HCOM), worth close to $11.8 million, accounting for 4% of its total 13F portfolio. Sitting at the No. 2 spot is Brian Taylor of Pine River Capital Management, with a $6 million position; 0.1% of its 13F portfolio is allocated to the stock. Remaining peers that hold long positions include Spencer M. Waxman's Shannon River Fund Management, J. Carlo Cannell's Cannell Capital and Sander Gerber's Hudson Bay Capital Management.
Insider purchases made by high-level executives is particularly usable when the company in question has experienced transactions within the past 180 days. Over the latest 180-day time period, Hawaiian Telcom HoldCo Inc (NASDAQ:HCOM) has seen 1 unique insiders buying, and zero insider sales (see the details of insider trades here).
Let's go over hedge fund and insider activity in other stocks similar to Hawaiian Telcom HoldCo Inc (NASDAQ:HCOM). These stocks are Lumos Networks Corp (NASDAQ:LMOS), IDT Corporation (NYSE:IDT), Cbeyond, Inc. (NASDAQ:CBEY), and ORBCOMM Inc (NASDAQ:ORBC). This group of stocks are in the diversified communication services industry and their market caps match HCOM's market cap.