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Is Brown Shoe Company, Inc. (BWS) Going to Burn These Hedge Funds?:Barnes & Noble, Inc. (BKS), American Greetings Corporation (AM)

Brown Shoe Company, Inc. (NYSE:BWS) was in 13 hedge funds’ portfolio at the end of the fourth quarter of 2012. BWS shareholders have witnessed an increase in activity from the world’s largest hedge funds of late. There were 11 hedge funds in our database with BWS positions at the end of the previous quarter.

Brown Shoe Company, Inc. (NYSE:BWS)

In today’s marketplace, there are tons of metrics investors can use to analyze the equity markets. A couple of the most innovative are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best fund managers can trounce the market by a solid amount (see just how much).

Equally as integral, bullish insider trading sentiment is a second way to break down the stock market universe. Just as you’d expect, there are a variety of incentives for a bullish insider to cut shares of his or her company, but just one, very obvious reason why they would behave bullishly. Many empirical studies have demonstrated the useful potential of this strategy if “monkeys” understand where to look (learn more here).

Keeping this in mind, it’s important to take a peek at the recent action surrounding Brown Shoe Company, Inc. (NYSE:BWS).

How have hedgies been trading Brown Shoe Company, Inc. (NYSE:BWS)?

At the end of the fourth quarter, a total of 13 of the hedge funds we track were long in this stock, a change of 18% from the previous quarter. With hedgies’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were increasing their stakes considerably.

When looking at the hedgies we track, AQR Capital Management, managed by Cliff Asness, holds the largest position in Brown Shoe Company, Inc. (NYSE:BWS). AQR Capital Management has a $11 million position in the stock, comprising 0.1% of its 13F portfolio. The second largest stake is held by Royce & Associates, managed by Chuck Royce, which held a $9 million position; the fund has 0% of its 13F portfolio invested in the stock. Other hedge funds that are bullish include Jim Simons’s Renaissance Technologies, Joel Greenblatt’s Gotham Asset Management and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.

Now, key hedge funds have been driving this bullishness. Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, assembled the largest position in Brown Shoe Company, Inc. (NYSE:BWS). Arrowstreet Capital had 1 million invested in the company at the end of the quarter. Steven Cohen’s SAC Capital Advisors also made a $1 million investment in the stock during the quarter. The other funds with new positions in the stock are Israel Englander’s Catapult Capital Management, Mike Vranos’s Ellington, and Drew Cupps’s Cupps Capital Management.

How are insiders trading Brown Shoe Company, Inc. (NYSE:BWS)?

Insider trading activity, especially when it’s bullish, is best served when the company in focus has seen transactions within the past 180 days. Over the last six-month time period, Brown Shoe Company, Inc. (NYSE:BWS) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Brown Shoe Company, Inc. (NYSE:BWS). These stocks are Barnes & Noble, Inc. (NYSE:BKS), American Greetings Corporation (NYSE:AM), United Online, Inc. (NASDAQ:UNTD), Titan Machinery Inc. (NASDAQ:TITN), and Zumiez Inc. (NASDAQ:ZUMZ). All of these stocks are in the specialty retail, other industry and their market caps match BWS’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Barnes & Noble, Inc. (NYSE:BKS) 18 0 3
American Greetings Corporation (NYSE:AM) 12 0 0
United Online, Inc. (NASDAQ:UNTD) 13 0 2
Titan Machinery Inc. (NASDAQ:TITN) 12 0 2
Zumiez Inc. (NASDAQ:ZUMZ) 7 0 0

With the returns shown by our research, retail investors must always pay attention to hedge fund and insider trading activity, and Brown Shoe Company, Inc. (NYSE:BWS) is no exception.

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

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