In the financial world, there are dozens of indicators shareholders can use to watch publicly traded companies. A duo of the most under-the-radar are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best investment managers can outpace the broader indices by a healthy margin (see just how much).
Equally as necessary, bullish insider trading sentiment is a second way to analyze the world of equities. Obviously, there are a number of motivations for a bullish insider to cut shares of his or her company, but only one, very clear reason why they would behave bullishly. Many academic studies have demonstrated the useful potential of this tactic if "monkeys" know what to do (learn more here).
Furthermore, let's study the newest info about OMNOVA Solutions Inc. (NYSE:OMN).
Heading into Q3, a total of 7 of the hedge funds we track were long in this stock, a change of -30% from the first quarter. With the smart money's capital changing hands, there exists a select group of noteworthy hedge fund managers who were increasing their stakes considerably.
When using filings from the hedgies we track, Mario Gabelli's GAMCO Investors had the biggest position in OMNOVA Solutions Inc. (NYSE:OMN), worth close to $11.8 million, comprising 0.1% of its total 13F portfolio. Sitting at the No. 2 spot is Tontine Asset Management, managed by Jeffrey Gendell, which held a $2.8 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Remaining hedgies that are bullish include Jim Simons's Renaissance Technologies, Joel Greenblatt's Gotham Asset Management and Gregory Fraser, Rudolph Kluiber, and Timothy Krochuk's GRT Capital Partners.
Because OMNOVA Solutions Inc. (NYSE:OMN) has witnessed dropping sentiment from the entirety of the hedge funds we track, it's safe to say that there lies a certain "tier" of funds who sold off their positions entirely in Q1. Intriguingly, Israel Englander's Millennium Management cut the largest stake of the "upper crust" of funds we watch, comprising close to $0.2 million in stock. Glenn Russell Dubin's fund, Highbridge Capital Management, also cut its stock, about $0.1 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest was cut by 3 funds in Q1.
Insider buying made by high-level executives is particularly usable when the company we're looking at has seen transactions within the past six months. Over the latest half-year time frame, OMNOVA Solutions Inc. (NYSE:OMN) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We'll check out the relationship between both of these indicators in other stocks similar to OMNOVA Solutions Inc. (NYSE:OMN). These stocks are REX American Resources Corp (NYSE:REX), Oil-Dri Corporation of America (NYSE:ODC), Ferro Corporation (NYSE:FOE), KMG Chemicals, Inc. (NYSE:KMG), and Green Plains Renewable Energy Inc. (NASDAQ:GPRE). This group of stocks are in the specialty chemicals industry and their market caps resemble OMN's market cap.