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Howard Hughes Corp (NYSE:HHC): Hedge Funds Are Bullish and Insiders Are Bearish, What Should You Do?

Is Howard Hughes Corp (NYSE:HHC) a bargain? Investors who are in the know are betting on the stock. The number of bullish hedge fund bets increased by 2 recently.

Howard Hughes Corp (NYSE:HHC)

In the financial world, there are many metrics investors can use to monitor their holdings. A duo of the most under-the-radar are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best hedge fund managers can outclass their index-focused peers by a significant amount (see just how much).

Equally as integral, optimistic insider trading sentiment is a second way to break down the stock market universe. Obviously, there are a number of stimuli for a corporate insider to get rid of shares of his or her company, but only one, very clear reason why they would initiate a purchase. Many academic studies have demonstrated the impressive potential of this tactic if investors understand where to look (learn more here).

Keeping this in mind, it’s important to take a gander at the key action surrounding Howard Hughes Corp (NYSE:HHC).

How have hedgies been trading Howard Hughes Corp (NYSE:HHC)?

In preparation for this year, a total of 17 of the hedge funds we track held long positions in this stock, a change of 13% from the third quarter. With hedge funds’ sentiment swirling, there exists a few notable hedge fund managers who were increasing their stakes significantly.

When looking at the hedgies we track, Bill Ackman’s Pershing Square had the largest position in Howard Hughes Corp (NYSE:HHC), worth close to $261 million, comprising 2.8% of its total 13F portfolio. On Pershing Square’s heels is Horizon Asset Management, managed by Murray Stahl, which held a $223 million position; 4.5% of its 13F portfolio is allocated to the stock. Other hedge funds that are bullish include John Paulson’s Paulson & Co, Stephen J. Errico’s Locust Wood Capital Advisers and Jim Simons’s Renaissance Technologies.

As one would reasonably expect, key hedge funds have jumped into Howard Hughes Corp (NYSE:HHC) headfirst. Locust Wood Capital Advisers, managed by Stephen J. Errico, established the most valuable position in Howard Hughes Corp (NYSE:HHC). Locust Wood Capital Advisers had 16 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made a $1 million investment in the stock during the quarter. The only other fund with a new position in the stock is Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.

What have insiders been doing with Howard Hughes Corp (NYSE:HHC)?

Insider buying is at its handiest when the company in focus has seen transactions within the past half-year. Over the latest half-year time period, Howard Hughes Corp (NYSE:HHC) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

With the results exhibited by the aforementioned tactics, retail investors must always pay attention to hedge fund and insider trading sentiment, and Howard Hughes Corp (NYSE:HHC) applies perfectly to this mantra.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.

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