In the financial world, there are dozens of metrics market participants can use to monitor their holdings. A pair of the most underrated are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the elite investment managers can trounce the S&P 500 by a significant amount (see just how much).
Equally as useful, optimistic insider trading activity is a second way to look at the investments you’re interested in. Obviously, there are lots of incentives for a bullish insider to cut shares of his or her company, but just one, very simple reason why they would behave bullishly. Various academic studies have demonstrated the market-beating potential of this strategy if you understand what to do (learn more here).
Now that that’s out of the way, it’s important to examine the latest info surrounding WABCO Holdings Inc. (NYSE:WBC).
Hedge fund activity in WABCO Holdings Inc. (NYSE:WBC)
In preparation for the third quarter, a total of 33 of the hedge funds we track were bullish in this stock, a change of 0% from one quarter earlier. With hedgies’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings substantially.
Out of the hedge funds we follow, Berkshire Hathaway, managed by Warren Buffett, holds the largest position in WABCO Holdings Inc. (NYSE:WBC). Berkshire Hathaway has a $304.5 million position in the stock, comprising 0.3% of its 13F portfolio. Coming in second is Alan Fournier of Pennant Capital Management, with a $225.1 million position; the fund has 4.2% of its 13F portfolio invested in the stock. Other hedge funds that are bullish include Bob Peck and Andy Raab’s FPR Partners, D. E. Shaw’s D E Shaw and Phill Gross and Robert Atchinson’s Adage Capital Management.
Because WABCO Holdings Inc. (NYSE:WBC) has faced bearish sentiment from upper-tier hedge fund managers, it’s safe to say that there is a sect of money managers who were dropping their entire stakes last quarter. It’s worth mentioning that Dinakar Singh’s TPG-AXON Management LP sold off the biggest stake of all the hedgies we key on, comprising about $59.8 million in stock. Rob Butts and Josh Clark’s fund, Southpoint Capital Advisors, also said goodbye to its stock, about $30 million worth. These transactions are interesting, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
What have insiders been doing with WABCO Holdings Inc. (NYSE:WBC)?
Insider buying is at its handiest when the primary stock in question has seen transactions within the past half-year. Over the last 180-day time period, WABCO Holdings Inc. (NYSE:WBC) has seen zero unique insiders purchasing, and 9 insider sales (see the details of insider trades here).
We’ll also take a look at the relationship between both of these indicators in other stocks similar to WABCO Holdings Inc. (NYSE:WBC). These stocks are TRW Automotive Holdings Corp. (NYSE:TRW), Visteon Corp (NYSE:VC), LKQ Corporation (NASDAQ:LKQ), Lear Corporation (NYSE:LEA), and Allison Transmission Holdings Inc (NYSE:ALSN). All of these stocks are in the auto parts industry and their market caps are similar to WBC’s market cap.