Acuity Brands, Inc. (NYSE:AYI) investors should pay attention to a decrease in hedge fund sentiment lately.
In today’s marketplace, there are a multitude of gauges market participants can use to watch Mr. Market. Two of the most innovative are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the top hedge fund managers can outpace the S&P 500 by a solid margin (see just how much).
Just as key, positive insider trading activity is a second way to break down the world of equities. As the old adage goes: there are lots of stimuli for a bullish insider to get rid of shares of his or her company, but just one, very clear reason why they would initiate a purchase. Many academic studies have demonstrated the market-beating potential of this strategy if shareholders know what to do (learn more here).
With these “truths” under our belt, let’s take a look at the key action surrounding Acuity Brands, Inc. (NYSE:AYI).
What does the smart money think about Acuity Brands, Inc. (NYSE:AYI)?
At the end of the fourth quarter, a total of 16 of the hedge funds we track were long in this stock, a change of 0% from the third quarter. With hedgies’ sentiment swirling, there exists a few noteworthy hedge fund managers who were upping their holdings meaningfully.
When looking at the hedgies we track, SAC Capital Advisors, managed by Steven Cohen, holds the largest position in Acuity Brands, Inc. (NYSE:AYI). SAC Capital Advisors has a $40.1 million position in the stock, comprising 0.2% of its 13F portfolio. The second largest stake is held by Phill Gross and Robert Atchinson of Adage Capital Management, with a $28.4 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other peers with similar optimism include Donald Chiboucis’s Columbus Circle Investors, Chuck Royce’s Royce & Associates and Andrew Sandler’s Sandler Capital Management.
Since Acuity Brands, Inc. (NYSE:AYI) has experienced bearish sentiment from the aggregate hedge fund industry, we can see that there lies a certain “tier” of hedgies that elected to cut their full holdings last quarter. Intriguingly, D. E. Shaw’s D E Shaw dropped the largest position of the “upper crust” of funds we key on, comprising an estimated $0.8 million in stock.. John Overdeck and David Siegel’s fund, Two Sigma Advisors, also dumped its stock, about $0.5 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
How have insiders been trading Acuity Brands, Inc. (NYSE:AYI)?
Insider trading activity, especially when it’s bullish, is most useful when the company we’re looking at has seen transactions within the past half-year. Over the last 180-day time frame, Acuity Brands, Inc. (NYSE:AYI) has experienced zero unique insiders purchasing, and 6 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Acuity Brands, Inc. (NYSE:AYI). These stocks are LG Display Co Ltd. (ADR) (NYSE:LPL), Sanmina Corp (NASDAQ:SANM), Molex Incorporated (NASDAQ:MOLX), AVX Corporation (NYSE:AVX), and Dolby Laboratories, Inc. (NYSE:DLB). All of these stocks are in the diversified electronics industry and their market caps are closest to AYI’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| LG Display Co Ltd. (ADR) (NYSE:LPL) | 9 | 0 | 0 |
| Sanmina Corp (NASDAQ:SANM) | 18 | 0 | 1 |
| Molex Incorporated (NASDAQ:MOLX) | 16 | 0 | 0 |
| AVX Corporation (NYSE:AVX) | 16 | 0 | 1 |
| Dolby Laboratories, Inc. (NYSE:DLB) | 13 | 0 | 7 |
With the results exhibited by Insider Monkey’s time-tested strategies, everyday investors should always pay attention to hedge fund and insider trading activity, and Acuity Brands, Inc. (NYSE:AYI) shareholders fit into this picture quite nicely.
