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Is Amedisys Inc (AMED) Going to Burn These Hedge Funds?

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In the eyes of many investors, hedge funds are seen as bloated, outdated financial vehicles of a period lost to current times. Although there are over 8,000 hedge funds in operation today, this site focuses on the upper echelon of this group, around 525 funds. Analysts calculate that this group controls most of the smart money’s total capital, and by tracking their highest quality stock picks, we’ve found a few investment strategies that have historically beaten the S&P 500. 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 began to sharing our picks with our subscribers at the end of August 2012, we have outperformed the S&P 500 index by 33 percentage points in 11 months (see all of our picks from August).

Equally as key, bullish insider trading activity is another way to analyze the financial markets. Just as you’d expect, there are lots of stimuli for an insider to drop shares of his or her company, but only one, very clear reason why they would buy. Many academic studies have demonstrated the valuable potential of this strategy if shareholders know where to look (learn more here).

Furthermore, it’s important to examine the recent info about Amedisys Inc (NASDAQ:AMED).

How are hedge funds trading Amedisys Inc (NASDAQ:AMED)?

At the end of the second quarter, a total of 9 of the hedge funds we track were long in this stock, a change of 13% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were upping their stakes substantially.

Amedisys IncWhen using filings from the hedgies we track, Phill Gross and Robert Atchinson’s Adage Capital Management had the most valuable position in Amedisys Inc (NASDAQ:AMED), worth close to $9.8 million, accounting for less than 0.1%% of its total 13F portfolio. On Adage Capital Management’s heels is Stephen DuBois of Camber Capital Management, with a $9.3 million position; 1% of its 13F portfolio is allocated to the company. Some other peers with similar optimism include Cliff Asness’s AQR Capital Management, James E. Flynn’s Deerfield Management and Ken Griffin’s Citadel Investment Group.

Consequently, particular hedge funds were leading the bulls’ herd. Adage Capital Management, managed by Phill Gross and Robert Atchinson, established the biggest position in Amedisys Inc (NASDAQ:AMED). Adage Capital Management had 9.8 million invested in the company at the end of the quarter. Stephen DuBois’s Camber Capital Management also initiated a $9.3 million position during the quarter. The following funds were also among the new AMED investors: Cliff Asness’s AQR Capital Management, James E. Flynn’s Deerfield Management, and Ken Griffin’s Citadel Investment Group.

How are insiders trading Amedisys Inc (NASDAQ:AMED)?

Insider buying is particularly usable when the company we’re looking at has experienced transactions within the past 180 days. Over the latest half-year time frame, Amedisys Inc (NASDAQ:AMED) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

We’ll also take a look at the relationship between both of these indicators in other stocks similar to Amedisys Inc (NASDAQ:AMED). These stocks are Chemed Corporation (NYSE:CHE), Addus Homecare Corporation (NASDAQ:ADUS), Almost Family, Inc. (NASDAQ:AFAM), LHC Group, Inc. (NASDAQ:LHCG), and Gentiva Health Services, Inc. (NASDAQ:GTIV). All of these stocks are in the home health care industry and their market caps are closest to AMED’s market cap.

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