Metlife Inc (NYSE:MET) interest among hedge funds has fallen slightly in recent months, but it may just be simple profit-taking. Whatever the reason may be, we’ll discuss it below, but it’s worth mentioning that shares of the mega-insurer are up over 45% year-to-date, so the valuation may be getting ahead of itself.
To the average investor, there are plenty of metrics investors can use to track Mr. Market. A duo of the most useful are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top hedge fund managers can outperform the broader indices by a healthy margin (see just how much).
Equally as key, bullish insider trading sentiment is a second way to analyze the investments you’re interested in. There are many reasons for a corporate insider to drop shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Several academic studies have demonstrated the useful potential of this tactic if shareholders understand what to do (learn more here).
Keeping this in mind, we’re going to analyze the recent info about Metlife Inc (NYSE:MET).
Hedge fund activity in Metlife Inc (NYSE:MET)
At Q2’s end, a total of 55 of the hedge funds we track were long in this stock, a change of -2% from the previous quarter. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were increasing their holdings considerably.
When using filings from the hedgies we track, Pzena Investment Management, managed by Richard S. Pzena, holds the most valuable position in Metlife Inc (NYSE:MET). Pzena Investment Management has a $340.9 million position in the stock, comprising 2.3% of its 13F portfolio. The second largest stake is held by Jeffrey Tannenbaum of Fir Tree, with a $248.1 million position; 3.4% of its 13F portfolio is allocated to the stock. Remaining hedgies with similar optimism include Ken Griffin’s Citadel Investment Group, David Tepper’s Appaloosa Management LP and Andreas Halvorsen’s Viking Global.
Judging by the fact that Metlife Inc (NYSE:MET) has experienced dropping sentiment from upper-tier hedge fund managers, logic holds that there were a few funds who were dropping their positions entirely last quarter. It’s worth mentioning that Bart Baum’s Ionic Capital Management cut the largest position of all the hedgies we watch, comprising an estimated $68.3 million in stock, and D. E. Shaw of D E Shaw was right behind this move, as the fund dropped about $59.4 million worth. These bearish behaviors are important to note, as total hedge fund interest was cut by 1 funds last quarter.
How have insiders been trading Metlife Inc (NYSE:MET)?
Bullish insider trading is best served when the company in focus has experienced transactions within the past six months. Over the latest six-month time frame, Metlife Inc (NYSE:MET) has seen zero unique insiders purchasing, and 6 insider sales (see the details of insider trades here).
We’ll also review the relationship between both of these indicators in other stocks similar to Metlife Inc (NYSE:MET). These stocks are China Life Insurance Company Ltd. (ADR) (NYSE:LFC), Manulife Financial Corporation (USA) (NYSE:MFC), Prudential Financial Inc (NYSE:PRU), ING Groep N.V. (ADR) (NYSE:ING), and Prudential Public Limited Company (ADR) (NYSE:PUK). This group of stocks are the members of the life insurance industry and their market caps resemble MET’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| China Life Insurance Company Ltd. (ADR) (NYSE:LFC) | 9 | 0 | 0 |
| Manulife Financial Corporation (USA) (NYSE:MFC) | 14 | 0 | 0 |
| Prudential Financial Inc (NYSE:PRU) | 31 | 0 | 6 |
| ING Groep N.V. (ADR) (NYSE:ING) | 22 | 0 | 0 |
| Prudential Public Limited Company (ADR) (NYSE:PUK) | 9 | 0 | 0 |
Using the returns explained by Insider Monkey’s strategies, regular investors should always track hedge fund and insider trading sentiment, and Metlife Inc (NYSE:MET) is no exception.
