Generac Holdings Inc. (NYSE:GNRC) investors should pay attention to an increase in activity from the world's largest hedge funds of late.
In today’s marketplace, there are a multitude of metrics investors can use to analyze publicly traded companies. A pair of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite fund managers can outclass the S&P 500 by a superb amount (see just how much).
Equally as beneficial, bullish insider trading sentiment is another way to parse down the financial markets. Obviously, there are a number of stimuli for a corporate insider to cut shares of his or her company, but only one, very obvious reason why they would behave bullishly. Various empirical studies have demonstrated the impressive potential of this strategy if you understand what to do (learn more here).
With all of this in mind, we're going to take a look at the latest action regarding Generac Holdings Inc. (NYSE:GNRC).
Heading into 2013, a total of 15 of the hedge funds we track held long positions in this stock, a change of 50% from one quarter earlier. With hedgies' capital changing hands, there exists an "upper tier" of noteworthy hedge fund managers who were boosting their stakes substantially.
When looking at the hedgies we track, Andrew Sandler's Sandler Capital Management had the biggest position in Generac Holdings Inc. (NYSE:GNRC), worth close to $43 million, accounting for 2.2% of its total 13F portfolio. The second largest stake is held by Renaissance Technologies, managed by Jim Simons, which held a $22 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining hedgies that are bullish include SAC Subsidiary's CR Intrinsic Investors, Ken Griffin's Citadel Investment Group and Israel Englander's Millennium Management.
As industrywide interest jumped, some big names have been driving this bullishness. CR Intrinsic Investors, managed by SAC Subsidiary, assembled the most valuable position in Generac Holdings Inc. (NYSE:GNRC). CR Intrinsic Investors had 16 million invested in the company at the end of the quarter. Israel Englander's Millennium Management also initiated a $8 million position during the quarter. The other funds with new positions in the stock are Anand Parekh's Alyeska Investment Group, Richard Driehaus's Driehaus Capital, and John Fichthorn's Dialectic Capital Management.
Insider purchases made by high-level executives is particularly usable when the company we're looking at has seen transactions within the past six months. Over the latest 180-day time period, Generac Holdings Inc. (NYSE:GNRC) has seen zero unique insiders buying, and 9 insider sales (see the details of insider trades here).
With the results demonstrated by Insider Monkey's research, retail investors must always watch hedge fund and insider trading activity, and Generac Holdings Inc. (NYSE:GNRC) applies perfectly to this mantra.
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