AeroVironment, Inc. (NASDAQ:AVAV) investors should pay attention to an increase in enthusiasm from smart money in recent months.
In today’s marketplace, there are many metrics investors can use to track their holdings. A pair of the best are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top hedge fund managers can outclass the S&P 500 by a solid amount (see just how much).
Equally as integral, optimistic insider trading activity is a second way to parse down the investments you're interested in. There are a number of stimuli for an executive to downsize shares of his or her company, but just one, very clear reason why they would behave bullishly. Several empirical studies have demonstrated the valuable potential of this method if shareholders know where to look (learn more here).
Now, it's important to take a look at the latest action regarding AeroVironment, Inc. (NASDAQ:AVAV).
Heading into 2013, a total of 11 of the hedge funds we track were long in this stock, a change of 57% from one quarter earlier. With hedge funds' capital changing hands, there exists a few key hedge fund managers who were increasing their stakes meaningfully.
According to our comprehensive database, Citadel Investment Group, managed by Ken Griffin, holds the largest position in AeroVironment, Inc. (NASDAQ:AVAV). Citadel Investment Group has a $12 million position in the stock, comprising 0% of its 13F portfolio. The second largest stake is held by Israel Englander of Millennium Management, with a $6 million position; 0% of its 13F portfolio is allocated to the stock. Some other hedge funds that are bullish include Jim Simons's Renaissance Technologies, Chuck Royce's Royce & Associates and John Overdeck and David Siegel's Two Sigma Advisors.
Consequently, some big names have jumped into AeroVironment, Inc. (NASDAQ:AVAV) headfirst. Millennium Management, managed by Israel Englander, assembled the biggest position in AeroVironment, Inc. (NASDAQ:AVAV). Millennium Management had 6 million invested in the company at the end of the quarter. John Overdeck and David Siegel's Two Sigma Advisors also made a $2 million investment in the stock during the quarter. The other funds with new positions in the stock are Neil Chriss's Hutchin Hill Capital, D. E. Shaw's D E Shaw, and Glenn Russell Dubin's Highbridge Capital Management.
Bullish insider trading is most useful when the company in question has seen transactions within the past six months. Over the last 180-day time frame, AeroVironment, Inc. (NASDAQ:AVAV) has experienced zero unique insiders buying, and 3 insider sales (see the details of insider trades here).
Let's check out hedge fund and insider activity in other stocks similar to AeroVironment, Inc. (NASDAQ:AVAV). These stocks are AAR Corp. (NYSE:AIR), LMI Aerospace, Inc. (NASDAQ:LMIA), Smith & Wesson Holding Corporation (NASDAQ:SWHC), Astronics Corporation (NASDAQ:ATRO), and TASER International, Inc. (NASDAQ:TASR). This group of stocks belong to the aerospace/defense products & services industry and their market caps are similar to AVAV's market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|AAR Corp. (NYSE:AIR)||13||0||4|
|LMI Aerospace, Inc. (NASDAQ:LMIA)||2||0||0|
|Smith & Wesson Holding Corporation (NASDAQ:SWHC)||14||1||2|
|Astronics Corporation (NASDAQ:ATRO)||6||0||2|
|TASER International, Inc. (NASDAQ:TASR)||16||1||2|
With the results shown by the aforementioned research, everyday investors should always monitor hedge fund and insider trading activity, and AeroVironment, Inc. (NASDAQ:AVAV) applies perfectly to this mantra.