Hedge Funds Aren’t Crazy About Sturm, Ruger & Company (RGR) Anymore

Page 1 of 2

Sturm, Ruger & Company (NYSE:RGR) shareholders have witnessed a decrease in enthusiasm from smart money of late.

To most traders, hedge funds are viewed as slow, old financial tools of years past. While there are greater than 8000 funds in operation today, we choose to focus on the upper echelon of this group, close to 450 funds. It is estimated that this group has its hands on the majority of all hedge funds’ total capital, and by paying attention to their best stock picks, we have uncovered a few investment strategies that have historically outperformed the S&P 500 index. Our small-cap hedge fund strategy outpaced 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 23.3 percentage points in 8 months (explore the details and some picks here).

Just as key, optimistic insider trading sentiment is another way to parse down the stock market universe. As the old adage goes: there are lots of motivations for a bullish insider to get rid of shares of his or her company, but only one, very clear reason why they would behave bullishly. Many empirical studies have demonstrated the market-beating potential of this tactic if piggybackers understand what to do (learn more here).

With these “truths” under our belt, it’s important to take a gander at the recent action encompassing Sturm, Ruger & Company (NYSE:RGR).

What have hedge funds been doing with Sturm, Ruger & Company (NYSE:RGR)?

At Q1′s end, a total of 16 of the hedge funds we track held long positions in this stock, a change of -11% from one quarter earlier. With the smart money’s positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were boosting their holdings substantially.

Sturm, Ruger & CompanyOf the funds we track, Rob Butts and Josh Clark’s Southpoint Capital Advisors had the biggest position in Sturm, Ruger & Company (NYSE:RGR), worth close to $15.4 million, comprising 1% of its total 13F portfolio. On Southpoint Capital Advisors’s heels is Hound Partners, managed by Jonathan Auerbach, which held a $11.4 million position; the fund has 0.7% of its 13F portfolio invested in the stock. Some other peers that are bullish include Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Jim Simons’s Renaissance Technologies and D. E. Shaw’s D E Shaw.

Because Sturm, Ruger & Company (NYSE:RGR) has witnessed bearish sentiment from the smart money, we can see that there is a sect of hedgies who were dropping their positions entirely in Q1. It’s worth mentioning that Chase Coleman and Feroz Dewan’s Tiger Global Management LLC dumped the biggest investment of the 450+ funds we key on, valued at about $36.3 million in stock., and Robert Bishop of Impala Asset Management was right behind this move, as the fund dropped about $24.9 million worth. These moves are intriguing to say the least, as total hedge fund interest was cut by 2 funds in Q1.

How are insiders trading Sturm, Ruger & Company (NYSE:RGR)?

Insider trading activity, especially when it’s bullish, is best served when the company we’re looking at has seen transactions within the past six months. Over the latest 180-day time frame, Sturm, Ruger & Company (NYSE:RGR) has seen zero unique insiders purchasing, and 11 insider sales (see the details of insider trades here).

Let’s also take a look at hedge fund and insider activity in other stocks similar to Sturm, Ruger & Company (NYSE:RGR). These stocks are Smith & Wesson Holding Corporation (NASDAQ:SWHC), AAR Corp. (NYSE:AIR), Kaman Corporation (NYSE:KAMN), and Orbital Sciences Corp (NYSE:ORB). All of these stocks are in the aerospace/defense products & services industry and their market caps are similar to RGR’s market cap.

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top Businesses to Invest In

Top 5 Things You Might Be Doing Wrong With Your Business

Top 5 Strategic Technology Trends in 2014

Top Rags to Riches Stories

Parenting Behavior That Promotes Future Leaders

Top 5 Mistakes Made by Small Businesses

Top 5 Most Common and Potentially Devastating Financial Blunders

Top 5 Highest Paying Jobs for Web Designers

Top 6 Most Respected Professions that Also Pay Well

Top 5 Pitfalls Investors Should Avoid

Top 6 Lawyers and Policy Makers Under 30

Top 6 New Year’s Resolutions for Entrepreneurs

Top 7 Locations to Check in on Facebook

Top 5 Mistakes made by Rookie eBay Sellers

Top 7 eBook Publishers in 2013

Top 6 Health Industry Trends in 2014

5 Lessons for Entrepreneurs from Seth Godin

Top 5 Success Tips from Jordan Belfort – the Wolf of Wall Street

Best Master’s in Finance Degree Programs

Top 6 Earning Celebrities Over 50

The most expensive sports to play

Top 7 Earning Celebrities Under 25

Best 7 Online Courses to Take: Free Finance MOOCs

Top 6 Bad Habits that Promote Failure

20 Most Valuable Soccer Teams in the World in 2013

12 Most Expensive Countries for Foreign Students

Top 30 Most Influential Women in the World

Top 20 Most Expensive New Year Eve Shows

Top 5 Best Vocational Careers

Top 10 Jobs for 2014 by Salary Gain (Predictions)

Top 5 Digital Trends for 2014

Top 6 Things You Can Do To Increase Your Productivity

Top 9 Trending Smartphones in 2013

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!