Is Universal Display Corporation (NASDAQ:PANL) a good investment?
In the 21st century investor’s toolkit, there are a multitude of indicators investors can use to monitor publicly traded companies. Some of the most useful are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best fund managers can outclass the S&P 500 by a significant amount (see just how much).
Equally as crucial, positive insider trading activity is another way to analyze the marketplace. Obviously, there are lots of motivations for an insider to cut shares of his or her company, but just one, very obvious reason why they would buy. Plenty of academic studies have demonstrated the useful potential of this strategy if investors know what to do (learn more here).
What's more, let's study the recent info about Universal Display Corporation (NASDAQ:PANL).
At the end of the second quarter, a total of 9 of the hedge funds we track were long in this stock, a change of -36% from the previous quarter. With hedgies' capital changing hands, there exists an "upper tier" of key hedge fund managers who were boosting their stakes substantially.
When using filings from the hedgies we track, Discovery Capital Management, managed by Rob Citrone, holds the biggest position in Universal Display Corporation (NASDAQ:PANL). Discovery Capital Management has a $194.9 million position in the stock, comprising 2.1% of its 13F portfolio. The second largest stake is held by D E Shaw, managed by D. E. Shaw, which held a $16.3 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other hedge funds with similar optimism include Douglas Dillard Jr. and Raj D. Venkatesan's Standard Pacific Capital, John A. Levin's Levin Capital Strategies and Ken Griffin's Citadel Investment Group.
Since Universal Display Corporation (NASDAQ:PANL) has witnessed bearish sentiment from the top-tier hedge fund industry, we can see that there lies a certain "tier" of money managers that elected to cut their positions entirely heading into Q2. Intriguingly, Noam Gottesman's GLG Partners dumped the largest stake of the "upper crust" of funds we watch, valued at an estimated $19.4 million in stock, and Christopher Lord of Criterion Capital was right behind this move, as the fund said goodbye to about $10.5 million worth. These transactions are important to note, as total hedge fund interest was cut by 5 funds heading into Q2.
Insider buying is best served when the primary stock in question has seen transactions within the past half-year. Over the last 180-day time period, Universal Display Corporation (NASDAQ:PANL) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We'll go over the relationship between both of these indicators in other stocks similar to Universal Display Corporation (NASDAQ:PANL). These stocks are Stratasys, Ltd. (NASDAQ:SSYS), Nice Systems Ltd (ADR) (NASDAQ:NICE), Electronics For Imaging, Inc. (NASDAQ:EFII), Logitech International SA (USA) (NASDAQ:LOGI), and Synaptics, Incorporated (NASDAQ:SYNA). All of these stocks are in the computer peripherals industry and their market caps are closest to PANL's market cap.