Is Zebra Technologies Corp. (NASDAQ:ZBRA) a buy right now? Prominent investors are in a pessimistic mood. The number of bullish hedge fund positions stayed the same which is a slightly negative development in our experience
To the average investor, there are plenty of methods investors can use to watch publicly traded companies. Two of the most underrated are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite hedge fund managers can outperform the broader indices by a significant margin (see just how much).
Just as beneficial, bullish insider trading sentiment is a second way to parse down the investments you’re interested in. There are lots of incentives for a corporate insider to cut shares of his or her company, but just one, very obvious reason why they would behave bullishly. Several empirical studies have demonstrated the useful potential of this method if you understand where to look (learn more here).
Now, it’s important to take a glance at the latest action encompassing Zebra Technologies Corp. (NASDAQ:ZBRA).
How have hedgies been trading Zebra Technologies Corp. (NASDAQ:ZBRA)?
In preparation for this quarter, a total of 16 of the hedge funds we track were long in this stock, a change of 0% from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of key hedge fund managers who were upping their stakes meaningfully.
When looking at the hedgies we track, Royce & Associates, managed by Chuck Royce, holds the most valuable position in Zebra Technologies Corp. (NASDAQ:ZBRA). Royce & Associates has a $176.7 million position in the stock, comprising 0.5% of its 13F portfolio. On Royce & Associates’s heels is Eminence Capital, managed by Ricky Sandler, which held a $84.2 million position; the fund has 2.2% of its 13F portfolio invested in the stock. Some other hedge funds with similar optimism include Robert Rodriguez and Steven Romick’s First Pacific Advisors LLC, D. E. Shaw’s D E Shaw and Mario Gabelli’s GAMCO Investors.
Judging by the fact that Zebra Technologies Corp. (NASDAQ:ZBRA) has faced falling interest from the smart money, we can see that there were a few money managers that elected to cut their entire stakes heading into Q2. It’s worth mentioning that Peter Rathjens Bruce Clarke and John Campbell’s Arrowstreet Capital dumped the largest investment of all the hedgies we track, worth close to $33.2 million in stock.. Peter Rathjens Bruce Clarke and John Campbell’s fund, Arrowstreet Capital, also said goodbye to its stock, about $1.4 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
What do corporate executives and insiders think about Zebra Technologies Corp. (NASDAQ:ZBRA)?
Insider trading activity, especially when it’s bullish, is best served when the company we’re looking at has seen transactions within the past 180 days. Over the last half-year time frame, Zebra Technologies Corp. (NASDAQ:ZBRA) has experienced zero unique insiders buying, and 7 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Zebra Technologies Corp. (NASDAQ:ZBRA). These stocks are Sauer-Danfoss Inc. (NYSE:SHS), Rexnord Corp (NYSE:RXN), ITT Corp (NYSE:ITT), Actuant Corporation (NYSE:ATU), and Generac Holdings Inc. (NYSE:GNRC). This group of stocks are the members of the diversified machinery industry and their market caps are similar to ZBRA’s market cap.