Is Comfort Systems USA, Inc. (NYSE:FIX) a safe investment now? The best stock pickers are in a pessimistic mood. The number of long hedge fund bets stayed the same which is a slightly negative development in our experience
To the average investor, there are plenty of gauges market participants can use to analyze the equity markets. A pair of the best are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the elite investment managers can outclass the broader indices by a solid amount (see just how much).
Equally as key, optimistic insider trading sentiment is another way to parse down the marketplace. There are a variety of incentives for an insider to drop shares of his or her company, but just one, very simple reason why they would behave bullishly. Plenty of academic studies have demonstrated the valuable potential of this strategy if investors understand what to do (learn more here).
With all of this in mind, we're going to take a glance at the key action surrounding Comfort Systems USA, Inc. (NYSE:FIX).
At the end of the first quarter, a total of 7 of the hedge funds we track were long in this stock, a change of 0% from the previous quarter. With hedgies' capital changing hands, there exists a select group of key hedge fund managers who were increasing their holdings significantly.
Of the funds we track, Chuck Royce's Royce & Associates had the most valuable position in Comfort Systems USA, Inc. (NYSE:FIX), worth close to $12.1 million, accounting for less than 0.1%% of its total 13F portfolio. Sitting at the No. 2 spot is Gotham Asset Management, managed by Joel Greenblatt, which held a $1.1 million position; 0.1% of its 13F portfolio is allocated to the stock. Other peers that hold long positions include Ken Griffin's Citadel Investment Group, Israel Englander's Millennium Management and Cliff Asness's AQR Capital Management.
Since Comfort Systems USA, Inc. (NYSE:FIX) has faced declining sentiment from the aggregate hedge fund industry, we can see that there were a few funds who were dropping their full holdings in Q1. It's worth mentioning that D. E. Shaw's D E Shaw dropped the largest investment of the 450+ funds we track, totaling about $0.3 million in stock. These transactions are intriguing to say the least, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Insider buying is best served when the company we're looking at has seen transactions within the past 180 days. Over the latest half-year time period, Comfort Systems USA, Inc. (NYSE:FIX) has seen zero unique insiders purchasing, and 5 insider sales (see the details of insider trades here).
Let's also review hedge fund and insider activity in other stocks similar to Comfort Systems USA, Inc. (NYSE:FIX). These stocks are Quanta Services Inc (NYSE:PWR), Emcor Group Inc (NYSE:EME), Integrated Electrical Services, Inc. (NASDAQ:IESC), Pike Electric Corporation (NYSE:PIKE), and MYR Group Inc (NASDAQ:MYRG). This group of stocks are in the general contractors industry and their market caps match FIX's market cap.