Is The Western Union Company (NYSE:WU) the right pick for your portfolio? The smart money is turning bullish. The number of bullish hedge fund positions advanced by 5 lately.
In today’s marketplace, there are dozens of gauges shareholders can use to analyze Mr. Market. Some 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 top picks of the top fund managers can outperform their index-focused peers by a solid margin (see just how much).
Just as key, bullish insider trading sentiment is another way to break down the marketplace. Just as you'd expect, there are a variety of motivations for an insider to downsize shares of his or her company, but only one, very obvious reason why they would behave bullishly. Many academic studies have demonstrated the market-beating potential of this tactic if piggybackers know where to look (learn more here).
With these "truths" under our belt, let's take a look at the key action encompassing The Western Union Company (NYSE:WU).
In preparation for this year, a total of 33 of the hedge funds we track were long in this stock, a change of 18% from the third quarter. With the smart money's positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were increasing their stakes substantially.
When looking at the hedgies we track, John Shapiro's Chieftain Capital had the largest position in The Western Union Company (NYSE:WU), worth close to $207 million, accounting for 16.4% of its total 13F portfolio. On Chieftain Capital's heels is Omega Advisors, managed by Leon Cooperman, which held a $58 million position; the fund has 1.1% of its 13F portfolio invested in the stock. Some other hedgies that are bullish include Ken Griffin's Citadel Investment Group, John W. Rogers's Ariel Investments and Tony Chedraoui's Tyrus Capital.
As one would reasonably expect, key money managers were breaking ground themselves. Tyrus Capital, managed by Tony Chedraoui, assembled the most valuable position in The Western Union Company (NYSE:WU). Tyrus Capital had 36 million invested in the company at the end of the quarter. Jeffrey Vinik's Vinik Asset Management also made a $15 million investment in the stock during the quarter. The other funds with brand new WU positions are Glenn Russell Dubin's Highbridge Capital Management, Mario Cibelli's Marathon Partners, and Kevin Michael Ulrich's Anchorage Advisors.
Insider buying is particularly usable when the company in focus has experienced transactions within the past 180 days. Over the last six-month time period, The Western Union Company (NYSE:WU) has experienced 5 unique insiders buying, and zero insider sales (see the details of insider trades here).
With the returns demonstrated by our research, everyday investors must always watch hedge fund and insider trading sentiment, and The Western Union Company (NYSE:WU) is no exception.
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.