Trimble Navigation Limited (NASDAQ:TRMB) investors should pay attention to a decrease in enthusiasm from smart money of late.
If you'd ask most traders, hedge funds are assumed to be slow, old financial tools of years past. While there are over 8000 funds trading today, we hone in on the moguls of this club, around 450 funds. Most estimates calculate that this group controls most of all hedge funds' total capital, and by monitoring their top stock picks, we have unsheathed a few investment strategies that have historically outstripped the S&P 500 index. Our small-cap hedge fund strategy outperformed 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).
Equally as important, positive insider trading sentiment is another way to parse down the world of equities. There are a variety of incentives for an executive to sell shares of his or her company, but just one, very obvious reason why they would behave bullishly. Several empirical studies have demonstrated the valuable potential of this method if "monkeys" know where to look (learn more here).
Keeping this in mind, we're going to take a gander at the recent action encompassing Trimble Navigation Limited (NASDAQ:TRMB).
In preparation for this year, a total of 11 of the hedge funds we track held long positions in this stock, a change of -8% from the previous quarter. With the smart money's capital changing hands, there exists a few key hedge fund managers who were upping their stakes considerably.
When looking at the hedgies we track, Donald Chiboucis's Columbus Circle Investors had the largest position in Trimble Navigation Limited (NASDAQ:TRMB), worth close to $46.4 million, accounting for 0.4% of its total 13F portfolio. Coming in second is Jeffrey Vinik of Vinik Asset Management, with a $10.4 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Some other peers that hold long positions include D. E. Shaw's D E Shaw, Joseph A. Jolson's Harvest Capital Strategies and Ken Griffin's Citadel Investment Group.
Judging by the fact that Trimble Navigation Limited (NASDAQ:TRMB) has witnessed bearish sentiment from the aggregate hedge fund industry, it's easy to see that there was a specific group of hedge funds that decided to sell off their entire stakes at the end of the year. It's worth mentioning that Robert Joseph Caruso's Select Equity Group cut the biggest stake of the 450+ funds we key on, valued at an estimated $13.2 million in stock.. David Harding's fund, Winton Capital Management, also dumped its stock, about $0.8 million worth. These transactions are important to note, as aggregate hedge fund interest was cut by 1 funds at the end of the year.
Insider buying is best served when the company we're looking at has seen transactions within the past half-year. Over the last 180-day time period, Trimble Navigation Limited (NASDAQ:TRMB) has seen zero unique insiders purchasing, and 10 insider sales (see the details of insider trades here).
Let's also examine hedge fund and insider activity in other stocks similar to Trimble Navigation Limited (NASDAQ:TRMB). These stocks are Bio-Rad Laboratories, Inc. (NYSE:BIO), Sensata Technologies Holding N.V. (NYSE:ST), Garmin Ltd. (NASDAQ:GRMN), and Waters Corporation (NYSE:WAT). This group of stocks are in the scientific & technical instruments industry and their market caps are closest to TRMB's market cap.