Dolby Laboratories, Inc. (NYSE:DLB) has experienced a decrease in enthusiasm from smart money in recent months.
In today’s marketplace, there are dozens of indicators investors can use to analyze stocks. Two of the most innovative 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 investment managers can outperform the market by a significant margin (see just how much).
Just as important, optimistic insider trading sentiment is a second way to break down the investments you’re interested in. Just as you’d expect, there are a variety of stimuli for a corporate insider to sell shares of his or her company, but only one, very obvious reason why they would initiate a purchase. Plenty of empirical studies have demonstrated the market-beating potential of this strategy if you understand where to look (learn more here).
Now, we’re going to take a look at the key action encompassing Dolby Laboratories, Inc. (NYSE:DLB).
What does the smart money think about Dolby Laboratories, Inc. (NYSE:DLB)?
At the end of the fourth quarter, a total of 13 of the hedge funds we track held long positions in this stock, a change of -19% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were upping their stakes substantially.
When looking at the hedgies we track, Renaissance Technologies, managed by Jim Simons, holds the biggest position in Dolby Laboratories, Inc. (NYSE:DLB). Renaissance Technologies has a $56 million position in the stock, comprising 0.2% of its 13F portfolio. On Renaissance Technologies’s heels is Chuck Royce of Royce & Associates, with a $52 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Some other peers with similar optimism include Cliff Asness’s AQR Capital Management, Joel Greenblatt’s Gotham Asset Management and Wilmot B. Harkey and Daniel Mack’s Nantahala Capital Management.
Since Dolby Laboratories, Inc. (NYSE:DLB) has faced bearish sentiment from the smart money, logic holds that there was a specific group of hedge funds that decided to sell off their entire stakes last quarter. Interestingly, Peter Algert and Kevin Coldiron’s Algert Coldiron Investors sold off the biggest investment of the “upper crust” of funds we watch, comprising an estimated $4 million in stock.. Zeke Ashton’s fund, Centaur Capital Partners, also dumped its stock, about $2 million worth. These bearish behaviors are important to note, as aggregate hedge fund interest was cut by 3 funds last quarter.
How have insiders been trading Dolby Laboratories, Inc. (NYSE:DLB)?
Bullish insider trading is at its handiest when the primary stock in question has experienced transactions within the past half-year. Over the last six-month time period, Dolby Laboratories, Inc. (NYSE:DLB) has seen zero unique insiders purchasing, and 7 insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to Dolby Laboratories, Inc. (NYSE:DLB). These stocks are Amphenol Corporation (NYSE:APH), LG Display Co Ltd. (ADR) (NYSE:LPL), AVX Corporation (NYSE:AVX), Molex Incorporated (NASDAQ:MOLX), and Acuity Brands, Inc. (NYSE:AYI). This group of stocks are in the diversified electronics industry and their market caps are similar to DLB’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Amphenol Corporation (NYSE:APH)||16||0||13|
|LG Display Co Ltd. (ADR) (NYSE:LPL)||9||0||0|
|AVX Corporation (NYSE:AVX)||16||0||1|
|Molex Incorporated (NASDAQ:MOLX)||16||0||0|
|Acuity Brands, Inc. (NYSE:AYI)||16||0||6|
With the returns exhibited by our tactics, retail investors must always watch hedge fund and insider trading sentiment, and Dolby Laboratories, Inc. (NYSE:DLB) applies perfectly to this mantra.