Is Cascade Corporation (NYSE:CASC) ready to rally soon? Investors who are in the know are taking a bearish view. The number of bullish hedge fund positions decreased by 5 lately.
If you'd ask most market participants, hedge funds are perceived as worthless, outdated investment tools of yesteryear. While there are greater than 8000 funds in operation at the moment, we choose to focus on the top tier of this club, about 450 funds. It is widely believed that this group has its hands on the majority of the hedge fund industry's total asset base, and by tracking their top investments, we have identified a number of investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points per annum 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 topped the S&P 500 index by 23.3 percentage points in 8 months (see the details here).
Just as integral, positive insider trading activity is a second way to parse down the world of equities. There are many stimuli for an executive to sell shares of his or her company, but only one, very obvious reason why they would buy. Various academic studies have demonstrated the useful potential of this tactic if "monkeys" understand where to look (learn more here).
Keeping this in mind, let's take a gander at the key action regarding Cascade Corporation (NYSE:CASC).
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 -38% from the previous quarter. With hedgies' positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were increasing their holdings meaningfully.
According to our comprehensive database, John Paulson's Paulson & Co had the largest position in Cascade Corporation (NYSE:CASC), worth close to $58.5 million, accounting for 0.3% of its total 13F portfolio. The second largest stake is held by Cliff Asness of AQR Capital Management, with a $47.7 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Remaining peers that are bullish include Jean-Marie Eveillard's First Eagle Investment Management, Matthew Tewksbury's Stevens Capital Management and Jim Simons's Renaissance Technologies.
Because Cascade Corporation (NYSE:CASC) has faced a declination in interest from the entirety of the hedge funds we track, logic holds that there were a few fund managers that elected to cut their full holdings last quarter. At the top of the heap, Robert Emil Zoellner's Alpine Associates said goodbye to the largest investment of all the hedgies we watch, totaling an estimated $30.8 million in stock.. Chuck Royce's fund, Royce & Associates, also dropped its stock, about $6.3 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest dropped by 5 funds last quarter.
Insider trading activity, especially when it's bullish, is particularly usable when the company we're looking at has seen transactions within the past 180 days. Over the latest six-month time frame, Cascade Corporation (NYSE:CASC) has experienced zero unique insiders buying, and 1 insider sales (see the details of insider trades here).
Let's check out hedge fund and insider activity in other stocks similar to Cascade Corporation (NYSE:CASC). These stocks are NACCO Industries, Inc. (NYSE:NC), Columbus McKinnon Corp. (NASDAQ:CMCO), Alamo Group, Inc. (NYSE:ALG), Lindsay Corporation (NYSE:LNN), and Astec Industries, Inc. (NASDAQ:ASTE). All of these stocks are in the farm & construction machinery industry and their market caps match CASC's market cap.