ShoreTel, Inc. (NASDAQ:SHOR) has seen a decrease in support from the world’s most elite money managers recently.
In the eyes of most investors, hedge funds are seen as unimportant, old investment tools of the past. While there are greater than 8000 funds with their doors open today, we at Insider Monkey choose to focus on the crème de la crème of this group, around 450 funds. It is estimated that this group has its hands on the lion’s share of the hedge fund industry’s total capital, and by watching their highest performing investments, we have spotted a few investment strategies that have historically beaten the S&P 500 index. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have beaten the S&P 500 index by 24 percentage points in 7 months (check out a sample of our picks).
Equally as integral, optimistic insider trading sentiment is another way to parse down the investments you’re interested in. There are plenty of reasons for an executive to drop shares of his or her company, but just one, very clear reason why they would behave bullishly. Plenty of academic studies have demonstrated the impressive potential of this strategy if piggybackers understand what to do (learn more here).
Consequently, it’s important to take a look at the recent action regarding ShoreTel, Inc. (NASDAQ:SHOR).
Hedge fund activity in ShoreTel, Inc. (NASDAQ:SHOR)
Heading into 2013, a total of 7 of the hedge funds we track were long in this stock, a change of -13% from one quarter earlier. With hedge funds’ sentiment swirling, there exists a few notable hedge fund managers who were increasing their holdings substantially.
When looking at the hedgies we track, Steven Cohen’s SAC Capital Advisors had the biggest position in ShoreTel, Inc. (NASDAQ:SHOR), worth close to $4.2 million, comprising less than 0.1%% of its total 13F portfolio. Sitting at the No. 2 spot is Renaissance Technologies, managed by Jim Simons, which held a $2.3 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other hedge funds with similar optimism include D. E. Shaw’s D E Shaw, Philip Hempleman’s Ardsley Partners and Israel Englander’s Millennium Management.
Seeing as ShoreTel, Inc. (NASDAQ:SHOR) has experienced declining sentiment from the aggregate hedge fund industry, we can see that there were a few hedgies that elected to cut their full holdings heading into 2013. It’s worth mentioning that Ken Grossman and Glen Schneider’s SG Capital Management dropped the biggest investment of the 450+ funds we watch, comprising about $1.6 million in stock., and J. Carlo Cannell of Cannell Capital was right behind this move, as the fund sold off about $0.2 million worth. These moves are intriguing to say the least, as total hedge fund interest dropped by 1 funds heading into 2013.
What do corporate executives and insiders think about ShoreTel, Inc. (NASDAQ:SHOR)?
Insider buying is most useful when the primary stock in question has seen transactions within the past six months. Over the latest half-year time frame, ShoreTel, Inc. (NASDAQ:SHOR) has experienced zero unique insiders purchasing, and 1 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to ShoreTel, Inc. (NASDAQ:SHOR). These stocks are Gilat Satellite Networks Ltd. (NASDAQ:GILT), Numerex Corp. (NASDAQ:NMRX), KVH Industries, Inc. (NASDAQ:KVHI), Aviat Networks Inc (NASDAQ:AVNW), and Mitel Networks Corporation (NASDAQ:MITL). This group of stocks are in the communication equipment industry and their market caps are similar to SHOR’s market cap.