Is Wisconsin Energy Corporation (NYSE:WEC) going to take off soon? Hedge funds are reducing their bets on the stock. The number of long hedge fund positions fell by 3 recently.
At the moment, there are many metrics shareholders can use to track their holdings. A duo of the most under-the-radar 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 investment managers can outclass the market by a healthy amount (see just how much).
Just as integral, optimistic insider trading activity is a second way to parse down the stock market universe. There are plenty of incentives for a corporate insider to downsize shares of his or her company, but only one, very obvious reason why they would buy. Many empirical studies have demonstrated the valuable potential of this tactic if piggybackers know where to look (learn more here).
Keeping this in mind, let's take a look at the recent action surrounding Wisconsin Energy Corporation (NYSE:WEC).
In preparation for this quarter, a total of 9 of the hedge funds we track were bullish in this stock, a change of -25% from one quarter earlier.
Due to the fact that Wisconsin Energy Corporation (NYSE:WEC) has faced bearish sentiment from the aggregate hedge fund industry, it's easy to see that there exists a select few hedge funds that elected to cut their entire stakes at the end of the first quarter. At the top of the heap, Ken Griffin's Citadel Investment Group dumped the largest investment of all the hedgies we track, valued at an estimated $2.8 million in stock., and Mike Vranos of Ellington was right behind this move, as the fund dumped about $1.1 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest was cut by 3 funds at the end of the first quarter.
Bullish insider trading is best served when the primary stock in question has experienced transactions within the past half-year. Over the last six-month time period, Wisconsin Energy Corporation (NYSE:WEC) has experienced 1 unique insiders buying, and 6 insider sales (see the details of insider trades here).
Let's also review hedge fund and insider activity in other stocks similar to Wisconsin Energy Corporation (NYSE:WEC). These stocks are DTE Energy Co (NYSE:DTE), Entergy Corporation (NYSE:ETR), The AES Corporation (NYSE:AES), Calpine Corporation (NYSE:CPN), and Companhia Energetica Minas Gerais (ADR) (NYSE:CIG). This group of stocks belong to the electric utilities industry and their market caps resemble WEC's market cap.