Is True Religion Apparel, Inc. (NASDAQ:TRLG) a great investment today? Hedge funds are in a bullish mood. The number of bullish hedge fund positions inched up by 3 recently.
In the eyes of most stock holders, hedge funds are perceived as underperforming, outdated financial tools of the past. While there are more than 8000 funds in operation at the moment, we at Insider Monkey hone in on the upper echelon of this group, around 450 funds. It is widely believed that this group has its hands on the lion’s share of the smart money’s total capital, and by paying attention to their top stock picks, we have formulated a number of investment strategies that have historically beaten Mr. Market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points a year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have trumped the S&P 500 index by 24 percentage points in 7 months (see the details here).
Equally as integral, positive insider trading activity is a second way to parse down the financial markets. Just as you’d expect, there are a variety of incentives for an executive to sell shares of his or her company, but only one, very clear reason why they would initiate a purchase. Various academic studies have demonstrated the impressive potential of this tactic if “monkeys” understand where to look (learn more here).
Consequently, let’s take a look at the recent action surrounding True Religion Apparel, Inc. (NASDAQ:TRLG).
What does the smart money think about True Religion Apparel, Inc. (NASDAQ:TRLG)?
At year’s end, a total of 13 of the hedge funds we track were long in this stock, a change of 30% from the third quarter. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were boosting their stakes substantially.
According to our comprehensive database, Chuck Royce’s Royce & Associates had the biggest position in True Religion Apparel, Inc. (NASDAQ:TRLG), worth close to $17.2 million, comprising 0.1% of its total 13F portfolio. On Royce & Associates’s heels is TIG Advisors, managed by Carl Tiedemann and Michael Tiedemann, which held a $6.5 million position; the fund has 1.2% of its 13F portfolio invested in the stock. Other peers that hold long positions include Richard C. Patton’s Courage Capital, and Ken Griffin’s Citadel Investment Group.
Consequently, some big names have been driving this bullishness. TIG Advisors, managed by Carl Tiedemann and Michael Tiedemann, established the biggest position in True Religion Apparel, Inc. (NASDAQ:TRLG). TIG Advisors had 6.5 million invested in the company at the end of the quarter. Louis Bacon’s Moore Global Investments also initiated a $5.1 million position during the quarter. The following funds were also among the new TRLG investors: James Dinan’s York Capital Management, Steven Cohen’s SAC Capital Advisors, and Lisa Rapuano’s Lane Five Capital.
How are insiders trading True Religion Apparel, Inc. (NASDAQ:TRLG)?
Insider buying is best served when the company in focus has seen transactions within the past half-year. Over the latest half-year time period, True Religion Apparel, Inc. (NASDAQ:TRLG) has seen zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to True Religion Apparel, Inc. (NASDAQ:TRLG). These stocks are Perry Ellis International, Inc. (NASDAQ:PERY), Maidenform Brands, Inc. (NYSE:MFB), Quiksilver, Inc. (NYSE:ZQK), Oxford Industries, Inc. (NYSE:OXM), and G-III Apparel Group, Ltd. (NASDAQ:GIII). This group of stocks are in the textile – apparel clothing industry and their market caps match TRLG’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Perry Ellis International, Inc. (NASDAQ:PERY)||8||0||8|
|Maidenform Brands, Inc. (NYSE:MFB)||8||0||4|
|Quiksilver, Inc. (NYSE:ZQK)||8||0||2|
|Oxford Industries, Inc. (NYSE:OXM)||5||2||3|
|G-III Apparel Group, Ltd. (NASDAQ:GIII)||14||1||4|
With the results demonstrated by our strategies, retail investors should always watch hedge fund and insider trading activity, and True Religion Apparel, Inc. (NASDAQ:TRLG) shareholders fit into this picture quite nicely.
See the top 7 most bullish money managers: