Walter Energy, Inc. (NYSE:WLT) shareholders have witnessed an increase in activity from the world's largest hedge funds recently.
In the 21st century investor’s toolkit, there are many metrics investors can use to monitor publicly traded companies. Some of the most underrated are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top fund managers can trounce the market by a very impressive amount (see just how much).
Just as integral, positive insider trading sentiment is a second way to break down the financial markets. There are plenty of reasons for an executive to sell shares of his or her company, but only one, very clear reason why they would initiate a purchase. Many academic studies have demonstrated the useful potential of this tactic if investors understand where to look (learn more here).
With these "truths" under our belt, it's important to take a glance at the latest action encompassing Walter Energy, Inc. (NYSE:WLT).
At year's end, 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 the smart money's positions undergoing their usual ebb and flow, there exists an "upper tier" of noteworthy hedge fund managers who were boosting their stakes considerably.
When looking at the hedgies we track, Dmitry Balyasny's Balyasny Asset Management had the biggest position in Walter Energy, Inc. (NYSE:WLT), worth close to $107.5 million, comprising 2.9% of its total 13F portfolio. Coming in second is SAC Capital Advisors, managed by Steven Cohen, which held a $59.7 million position; 0.3% of its 13F portfolio is allocated to the stock. Some other peers that hold long positions 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.
As one would reasonably expect, key hedge funds were leading the bulls' herd. Marathon Asset Management, managed by Bruce J. Richards and Louis Hanover, established the largest position in Walter Energy, Inc. (NYSE:WLT). Marathon Asset Management had 51.5 million invested in the company at the end of the quarter. Robert Bishop's Impala Asset Management also made a $13.4 million investment in the stock during the quarter. The other funds with brand new WLT positions are Jon Bauer's Contrarian Capital, Mark Kingdon's Kingdon Capital, and Anand Parekh's Alyeska Investment Group.
Insider trading activity, especially when it's bullish, is at its handiest when the primary stock in question has seen transactions within the past 180 days. Over the last half-year time period, Walter Energy, Inc. (NYSE:WLT) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let's check out hedge fund and insider activity in other stocks similar to Walter Energy, Inc. (NYSE:WLT). These stocks are Alliance Resource Partners, L.P. (NASDAQ:ARLP), PVR Partners LP (NYSE:PVR), Stillwater Mining Company (NYSE:SWC), HudBay Minerals Inc Ord Shs (NYSE:HBM), and Alpha Natural Resources, Inc. (NYSE:ANR). This group of stocks are in the industrial metals & minerals industry and their market caps are similar to WLT's market cap.