Career Education Corp. (NASDAQ:CECO) was in 14 hedge funds’ portfolio at the end of the first quarter of 2013. CECO investors should pay attention to an increase in activity from the world’s largest hedge funds of late. There were 12 hedge funds in our database with CECO holdings at the end of the previous quarter.
In the 21st century investor’s toolkit, there are dozens of metrics shareholders can use to analyze stocks. 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 top picks of the top fund managers can trounce the S&P 500 by a healthy amount (see just how much).
Just as beneficial, positive insider trading activity is another way to break down the stock market universe. As the old adage goes: there are a variety of stimuli for a bullish insider to sell shares of his or her company, but just one, very obvious reason why they would buy. Several empirical studies have demonstrated the valuable potential of this tactic if investors know what to do (learn more here).
With all of this in mind, let’s take a look at the latest action encompassing Career Education Corp. (NASDAQ:CECO).
Hedge fund activity in Career Education Corp. (NASDAQ:CECO)
At the end of the first quarter, a total of 14 of the hedge funds we track held long positions in this stock, a change of 17% from the first quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were increasing their holdings substantially.
Of the funds we track, Blum Capital Partners, managed by Richard Blum, holds the most valuable position in Career Education Corp. (NASDAQ:CECO). Blum Capital Partners has a $28 million position in the stock, comprising 4.3% of its 13F portfolio. Coming in second is AQR Capital Management, managed by Cliff Asness, which held a $15.4 million position; 0.1% of its 13F portfolio is allocated to the stock. Other hedge funds that hold long positions include Christopher Shackelton and Adam Gray’s Coliseum Capital, Jim Simons’s Renaissance Technologies and Michael Kao’s Akanthos Capital.
As industrywide interest jumped, some big names were leading the bulls’ herd. Akanthos Capital, managed by Michael Kao, established the largest position in Career Education Corp. (NASDAQ:CECO). Akanthos Capital had 1.3 million invested in the company at the end of the quarter. Ken Gray and Steve Walsh’s Bryn Mawr Capital also initiated a $0.4 million position during the quarter. The following funds were also among the new CECO investors: Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Israel Englander’s Millennium Management.
How are insiders trading Career Education Corp. (NASDAQ:CECO)?
Insider buying is most useful when the company in question has seen transactions within the past six months. Over the last half-year time period, Career Education Corp. (NASDAQ:CECO) has experienced 1 unique insiders purchasing, and 1 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Career Education Corp. (NASDAQ:CECO). These stocks are Xueda Education Group (ADR) (NYSE:XUE), ChinaEdu Corporation (ADR) (NASDAQ:CEDU), Lincoln Educational Services Corporation (NASDAQ:LINC), Corinthian Colleges Inc (NASDAQ:COCO), and China Distance Education Hldgs Ltd (ADR) (NYSE:DL). This group of stocks are in the education & training services industry and their market caps match CECO’s market cap.