Is Revlon Inc (NYSE:REV) a healthy stock for your portfolio? Hedge funds are selling. The number of long hedge fund bets stayed the same which is a slightly negative development in our experience
At the moment, there are tons of metrics shareholders can use to monitor stocks. Two of the most innovative are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top hedge fund managers can trounce the market by a solid amount (see just how much).
Just as beneficial, optimistic insider trading activity is a second way to parse down the investments you’re interested in. As the old adage goes: there are plenty of stimuli for a corporate insider to get rid of shares of his or her company, but only one, very obvious reason why they would buy. Several academic studies have demonstrated the impressive potential of this method if you understand what to do (learn more here).
Now, let’s take a peek at the recent action regarding Revlon Inc (NYSE:REV).
What have hedge funds been doing with Revlon Inc (NYSE:REV)?
At the end of the first quarter, a total of 8 of the hedge funds we track held long positions in this stock, a change of 0% from the first quarter. With hedge funds’ capital changing hands, there exists a select group of key hedge fund managers who were increasing their stakes significantly.
When looking at the hedgies we track, Gotham Asset Management, managed by Joel Greenblatt, holds the largest position in Revlon Inc (NYSE:REV). Gotham Asset Management has a $2.2 million position in the stock, comprising 0.1% of its 13F portfolio. On Gotham Asset Management’s heels is Jim Simons of Renaissance Technologies, with a $1.8 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining peers that are bullish include Robert B. Gillam’s McKinley Capital Management, Ken Griffin’s Citadel Investment Group and Israel Englander’s Millennium Management.
Due to the fact that Revlon Inc (NYSE:REV) has faced declining sentiment from hedge fund managers, it’s easy to see that there lies a certain “tier” of hedge funds who were dropping their entire stakes heading into Q2. It’s worth mentioning that Peter Troob’s Troob Capital Management cut the biggest investment of all the hedgies we track, totaling an estimated $10.4 million in stock.. Peter Rathjens, Bruce Clarke and John Campbell’s fund, Arrowstreet Capital, also said goodbye to its stock, about $0 million worth. These transactions are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
How are insiders trading Revlon Inc (NYSE:REV)?
Bullish insider trading is at its handiest when the company we’re looking at has seen transactions within the past six months. Over the last 180-day time period, Revlon Inc (NYSE:REV) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to Revlon Inc (NYSE:REV). These stocks are Blyth, Inc. (NYSE:BTH), Energizer Holdings, Inc. (NYSE:ENR), Nu Skin Enterprises, Inc. (NYSE:NUS), Inter Parfums, Inc. (NASDAQ:IPAR), and Elizabeth Arden, Inc. (NASDAQ:RDEN). This group of stocks are in the personal products industry and their market caps are closest to REV’s market cap.