Should You Avoid Staples, Inc. (NASDAQ:SPLS)?

Staples, Inc. (NASDAQ:SPLS) has experienced a decrease in hedge fund interest in recent months.

According to most traders, hedge funds are assumed to be unimportant, outdated investment vehicles of yesteryear. While there are greater than 8000 funds with their doors open at present, we look at the crème de la crème of this club, close to 450 funds. It is estimated that this group controls most of the smart money’s total capital, and by tracking their highest performing picks, we have identified a few investment strategies that have historically beaten the broader indices. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have outpaced the S&P 500 index by 25 percentage points in 6.5 month (explore the details and some picks here).

Staples, Inc. (NASDAQ:SPLS)Equally as integral, optimistic insider trading activity is another way to break down the financial markets. There are lots of incentives for an insider to get rid of shares of his or her company, but only one, very simple reason why they would buy. Several empirical studies have demonstrated the market-beating potential of this method if investors know where to look (learn more here).

With these “truths” under our belt, we’re going to take a look at the recent action encompassing Staples, Inc. (NASDAQ:SPLS).

What have hedge funds been doing with Staples, Inc. (NASDAQ:SPLS)?

Heading into 2013, a total of 34 of the hedge funds we track held long positions in this stock, a change of -11% from the previous quarter. With the smart money’s sentiment swirling, there exists a few notable hedge fund managers who were boosting their stakes meaningfully.

According to our comprehensive database, Pzena Investment Management, managed by Richard S. Pzena, holds the largest position in Staples, Inc. (NASDAQ:SPLS). Pzena Investment Management has a $447 million position in the stock, comprising 3.7% of its 13F portfolio. Coming in second is International Value Advisers, managed by Charles de Vaulx, which held a $143 million position; the fund has 3.2% of its 13F portfolio invested in the stock. Some other hedge funds that hold long positions include Russell Hawkins’s Hawkins Capital, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Donald Yacktman’s Yacktman Asset Management.

Because Staples, Inc. (NASDAQ:SPLS) has faced falling interest from the entirety of the hedge funds we track, we can see that there is a sect of hedgies who were dropping their entire stakes last quarter. At the top of the heap, Peter Adam Hochfelder’s Brahman Capital sold off the biggest stake of all the hedgies we track, comprising an estimated $37 million in call options. William B. Gray’s fund, Orbis Investment Management, also said goodbye to its stock, about $31 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest fell by 4 funds last quarter.

How have insiders been trading Staples, Inc. (NASDAQ:SPLS)?

Insider purchases made by high-level executives is most useful when the company in question has seen transactions within the past 180 days. Over the last half-year time period, Staples, Inc. (NASDAQ:SPLS) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).

With the returns shown by the aforementioned strategies, retail investors should always monitor hedge fund and insider trading activity, and Staples, Inc. (NASDAQ:SPLS) applies perfectly to this mantra.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

Top 6 Cities For The Ultra Rich to Live in Comfort

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!