Is Argan, Inc. (NYSEAMEX:AGX) a good investment?
If you were to ask many traders, hedge funds are viewed as bloated, old investment vehicles of an era lost to time. Although there are more than 8,000 hedge funds with their doors open in present day, Insider Monkey focuses on the crème de la crème of this group, around 525 funds. It is widely held that this group controls most of the hedge fund industry’s total capital, and by monitoring their highest quality equity investments, we’ve identified a number of investment strategies that have historically beaten the broader indices. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per annum 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 outpaced the S&P 500 index by 33 percentage points in 11 months (find the details here).
Equally as crucial, bullish insider trading activity is a second way to analyze the world of equities. Just as you’d expect, there are a number of motivations for an upper level exec to drop shares of his or her company, but only one, very obvious reason why they would buy. Plenty of academic studies have demonstrated the impressive potential of this method if investors understand what to do (learn more here).
What’s more, it’s important to examine the newest info for Argan, Inc. (NYSEAMEX:AGX).
How have hedgies been trading Argan, Inc. (NYSEAMEX:AGX)?
At Q2’s end, a total of 5 of the hedge funds we track were long in this stock, a change of 25% from the first quarter. With hedge funds’ sentiment swirling, there exists a few key hedge fund managers who were upping their holdings substantially.
According to our 13F database, Renaissance Technologies, managed by Jim Simons, holds the largest position in Argan, Inc. (NYSEAMEX:AGX). Renaissance Technologies has a $5 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Coming in second is Joel Greenblatt of Gotham Asset Management, with a $1 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other hedge funds with similar optimism include John Overdeck and David Siegel’s Two Sigma Advisors, Ken Griffin’s Citadel Investment Group and Mark A. Nordlicht’s Platinum Management.
Consequently, specific money managers were breaking ground themselves. Renaissance Technologies, managed by Jim Simons, created the largest position in Argan, Inc. (NYSEAMEX:AGX). Renaissance Technologies had 5 million invested in the company at the end of the quarter. Joel Greenblatt’s Gotham Asset Management also initiated a $1 million position during the quarter. The other funds with new positions in the stock are John Overdeck and David Siegel’s Two Sigma Advisors, Ken Griffin’s Citadel Investment Group, and Mark A. Nordlicht’s Platinum Management.
How are insiders trading Argan, Inc. (NYSEAMEX:AGX)?
Insider buying is at its handiest when the company we’re looking at has experienced transactions within the past 180 days. Over the latest 180-day time period, Argan, Inc. (NYSEAMEX:AGX) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We’ll go over the relationship between both of these indicators in other stocks similar to Argan, Inc. (NYSEAMEX:AGX). These stocks are Layne Christensen Company (NASDAQ:LAYN), Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD), Matrix Service Co (NASDAQ:MTRX), Orion Marine Group, Inc. (NYSE:ORN), and Sterling Construction Company, Inc. (NASDAQ:STRL). All of these stocks are in the heavy construction industry and their market caps are similar to AGX’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Layne Christensen Company (NASDAQ:LAYN) | 6 | 0 | 0 |
| Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) | 14 | 0 | 0 |
| Matrix Service Co (NASDAQ:MTRX) | 14 | 0 | 0 |
| Orion Marine Group, Inc. (NYSE:ORN) | 9 | 0 | 0 |
| Sterling Construction Company, Inc. (NASDAQ:STRL) | 6 | 0 | 0 |
Using the returns shown by the previously mentioned analyses, average investors should always track hedge fund and insider trading sentiment, and Argan, Inc. (NYSEAMEX:AGX) is no exception.
