Is HCP, Inc. (NYSE:HCP) a good investment?
In the eyes of many investors, hedge funds are assumed to be delayed, old financial tools of an era lost to time. Although there are over 8,000 hedge funds trading today, Insider Monkey looks at the elite of this group, about 525 funds. It is assumed that this group controls the lion’s share of the smart money’s total assets, and by keeping an eye on their highest quality investments, we’ve figured out a number of investment strategies that have historically beaten Mr. Market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per year 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 beaten the S&P 500 index by 33 percentage points in 11 months (find a sample of our picks).
Equally as useful, bullish insider trading activity is another way to look at the investments you’re interested in. There are plenty of motivations for a corporate insider to get rid of shares of his or her company, but just one, very simple reason why they would buy. Various academic studies have demonstrated the valuable potential of this method if shareholders know where to look (learn more here).
Now that that’s out of the way, it’s important to examine the latest info surrounding HCP, Inc. (NYSE:HCP).
What does the smart money think about HCP, Inc. (NYSE:HCP)?
At the end of the second quarter, a total of 26 of the hedge funds we track were long in this stock, a change of 30% from the previous quarter. With hedge funds’ sentiment swirling, there exists a select group of noteworthy hedge fund managers who were upping their holdings considerably.
Out of the hedge funds we follow, AEW Capital Management, managed by Jeffrey Furber, holds the biggest position in HCP, Inc. (NYSE:HCP). AEW Capital Management has a $183.5 million position in the stock, comprising 4.8% of its 13F portfolio. Coming in second is Jim Simons of Renaissance Technologies, with a $68 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Some other peers that hold long positions include D. E. Shaw’s D E Shaw, Jacob Gottlieb’s Visium Asset Management and Phill Gross and Robert Atchinson’s Adage Capital Management.
As aggregate interest spiked, certain money managers have jumped into HCP, Inc. (NYSE:HCP) headfirst. AEW Capital Management, managed by Jeffrey Furber, created the biggest position in HCP, Inc. (NYSE:HCP). AEW Capital Management had 183.5 million invested in the company at the end of the quarter. Jim Simons’s Renaissance Technologies also made a $68 million investment in the stock during the quarter. The other funds with new positions in the stock are D. E. Shaw’s D E Shaw, Jacob Gottlieb’s Visium Asset Management, and Phill Gross and Robert Atchinson’s Adage Capital Management.
How are insiders trading HCP, Inc. (NYSE:HCP)?
Insider buying made by high-level executives is at its handiest when the company we’re looking at has experienced transactions within the past 180 days. Over the last six-month time frame, HCP, Inc. (NYSE:HCP) has experienced zero unique insiders buying, 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 HCP, Inc. (NYSE:HCP). These stocks are Healthcare Realty Trust Inc (NYSE:HR), Healthcare Trust Of America Inc (NYSE:HTA), Omega Healthcare Investors Inc (NYSE:OHI), Health Care REIT, Inc. (NYSE:HCN), and Ventas, Inc. (NYSE:VTR). This group of stocks are the members of the reit – healthcare facilities industry and their market caps resemble HCP’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Healthcare Realty Trust Inc (NYSE:HR) | 10 | 0 | 0 |
| Healthcare Trust Of America Inc (NYSE:HTA) | 6 | 0 | 0 |
| Omega Healthcare Investors Inc (NYSE:OHI) | 13 | 0 | 0 |
| Health Care REIT, Inc. (NYSE:HCN) | 18 | 0 | 0 |
| Ventas, Inc. (NYSE:VTR) | 22 | 0 | 0 |
Using the returns shown by Insider Monkey’s research, average investors should always keep one eye on hedge fund and insider trading sentiment, and HCP, Inc. (NYSE:HCP) applies perfectly to this mantra.
