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Walter Energy, Inc. (NYSE:WLT): Are Hedge Funds Right About This Stock?

Walter Energy, Inc. (NYSE:WLT) investors should be aware of an increase in hedge fund interest in recent months.

In today’s marketplace, there are dozens of gauges investors can use to monitor the equity markets. A duo of the most useful are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best money managers can outpace the S&P 500 by a superb margin (see just how much).

Walter Energy, Inc. (NYSE:WLT)

Equally as key, optimistic insider trading sentiment is another way to parse down the investments you’re interested in. Just as you’d expect, there are many stimuli for an upper level exec to get rid of shares of his or her company, but just one, very obvious reason why they would buy. Various empirical studies have demonstrated the impressive potential of this tactic if shareholders know where to look (learn more here).

Consequently, it’s important to take a look at the key action surrounding Walter Energy, Inc. (NYSE:WLT).

How have hedgies been trading Walter Energy, Inc. (NYSE:WLT)?

At the end of the fourth quarter, a total of 30 of the hedge funds we track held long positions in this stock, a change of 20% from the previous quarter. With hedge funds’ capital changing hands, there exists a select group of notable hedge fund managers who were upping their holdings meaningfully.

According to our comprehensive database, Balyasny Asset Management, managed by Dmitry Balyasny, holds the largest position in Walter Energy, Inc. (NYSE:WLT). Balyasny Asset Management has a $107 million billion position in the stock, comprising 2.9% of its 13F portfolio. Coming in second is SAC Capital Advisors, managed by Steven Cohen, which held a $60 million position; 1.5% of its 13F portfolio is allocated to the stock. Remaining hedge funds with similar optimism include David Cohen and Harold Levy’s Iridian Asset Management, Jim Simons’s Renaissance Technologies and Bruce J. Richards and Louis Hanover’s Marathon Asset Management.

Now, key money managers have been driving this bullishness. Marathon Asset Management, managed by Bruce J. Richards and Louis Hanover, initiated the largest position in Walter Energy, Inc. (NYSE:WLT). Marathon Asset Management had 52 million invested in the company at the end of the quarter. Robert Bishop’s Impala Asset Management also initiated a $13 million position during the quarter. The other funds with new positions in the stock are Jon Bauer’s Contrarian Capital, Mark Kingdon’s Kingdon Capital, and Anand Parekh’s Alyeska Investment Group.

What have insiders been doing with Walter Energy, Inc. (NYSE:WLT)?

Bullish insider trading is most useful when the primary stock in question has seen transactions within the past 180 days. Over the latest half-year time period, Walter Energy, Inc. (NYSE:WLT) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).

With the returns demonstrated by Insider Monkey’s strategies, retail investors should always monitor hedge fund and insider trading activity, and Walter Energy, Inc. (NYSE:WLT) is an important part of this process.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

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