Is Computer Programs & Systems, Inc. (NASDAQ:CPSI) going to take off soon? Hedge funds are in a pessimistic mood. The number of long hedge fund positions were trimmed by 4 recently.
In today’s marketplace, there are many metrics investors can use to analyze Mr. Market. A duo of the most under-the-radar are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the elite money managers can outperform their index-focused peers by a healthy amount (see just how much).
Equally as beneficial, optimistic insider trading sentiment is another way to break down the stock market universe. Obviously, there are plenty of reasons for an upper level exec to drop shares of his or her company, but only one, very obvious reason why they would initiate a purchase. Several academic studies have demonstrated the valuable potential of this strategy if piggybackers know where to look (learn more here).
With all of this in mind, we’re going to take a look at the recent action regarding Computer Programs & Systems, Inc. (NASDAQ:CPSI).
What have hedge funds been doing with Computer Programs & Systems, Inc. (NASDAQ:CPSI)?
Heading into 2013, a total of 8 of the hedge funds we track were long in this stock, a change of -33% from the third quarter. With the smart money’s capital changing hands, there exists a select group of notable hedge fund managers who were boosting their holdings meaningfully.
Of the funds we track, Visium Asset Management, managed by Jacob Gottlieb, holds the most valuable position in Computer Programs & Systems, Inc. (NASDAQ:CPSI). Visium Asset Management has a $2.6 million position in the stock, comprising 0.1% of its 13F portfolio. Coming in second is Renaissance Technologies, managed by Jim Simons, which held a $1.9 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Some other peers with similar optimism include Cliff Asness’s AQR Capital Management, Joel Greenblatt’s Gotham Asset Management and John Overdeck and David Siegel’s Two Sigma Advisors.
Since Computer Programs & Systems, Inc. (NASDAQ:CPSI) has faced declining sentiment from the smart money, logic holds that there is a sect of money managers who sold off their full holdings last quarter. It’s worth mentioning that James E. Flynn’s Deerfield Management cut the biggest investment of the 450+ funds we monitor, comprising about $2.7 million in stock., and Jeffrey Vinik of Vinik Asset Management was right behind this move, as the fund dropped about $1.8 million worth. These moves are important to note, as total hedge fund interest dropped by 4 funds last quarter.
Insider trading activity in Computer Programs & Systems, Inc. (NASDAQ:CPSI)
Bullish insider trading is at its handiest when the company in question has seen transactions within the past 180 days. Over the last six-month time period, Computer Programs & Systems, Inc. (NASDAQ:CPSI) has seen 3 unique insiders buying, and 1 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Computer Programs & Systems, Inc. (NASDAQ:CPSI). These stocks are Medidata Solutions Inc (NASDAQ:MDSO), Merge Healthcare Inc. (NASDAQ:MRGE), WebMD Health Corp. (NASDAQ:WBMD), MedAssets, Inc. (NASDAQ:MDAS), and Quality Systems, Inc. (NASDAQ:QSII). This group of stocks are the members of the healthcare information services industry and their market caps are closest to CPSI’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Medidata Solutions Inc (NASDAQ:MDSO) | 11 | 0 | 7 |
| Merge Healthcare Inc. (NASDAQ:MRGE) | 10 | 2 | 0 |
| WebMD Health Corp. (NASDAQ:WBMD) | 13 | 0 | 0 |
| MedAssets, Inc. (NASDAQ:MDAS) | 18 | 0 | 8 |
| Quality Systems, Inc. (NASDAQ:QSII) | 11 | 1 | 0 |
With the results exhibited by Insider Monkey’s tactics, everyday investors should always monitor hedge fund and insider trading activity, and Computer Programs & Systems, Inc. (NASDAQ:CPSI) is an important part of this process.
