In today’s marketplace, there are dozens of methods market participants can use to watch publicly traded companies. A duo of the most underrated are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best investment managers can outpace their index-focused peers by a superb amount (see just how much).
Just as key, positive insider trading sentiment is a second way to analyze the stock market universe. As the old adage goes: there are lots of motivations for an upper level exec to downsize shares of his or her company, but just one, very clear reason why they would buy. Plenty of academic studies have demonstrated the market-beating potential of this tactic if “monkeys” know where to look (learn more here).
Keeping this in mind, it’s important to examine the latest info about Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR).
Hedge fund activity in Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B)
In preparation for the third quarter, a total of 5 of the hedge funds we track were long in this stock, a change of -50% from the first quarter. With hedge funds’ capital changing hands, there exists a few noteworthy hedge fund managers who were boosting their holdings substantially.
As Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B) has faced bearish sentiment from the top-tier hedge fund industry, it’s easy to see that there was a specific group of hedgies who were dropping their full holdings heading into Q2. At the top of the heap, Jeffrey Vinik’s Vinik Asset Management sold off the largest position of the “upper crust” of funds we key on, worth an estimated $17.9 million in stock. David Costen Haley’s fund, HBK Investments, also said goodbye to its stock, about $0.7 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest dropped by 5 funds heading into Q2.
How have insiders been trading Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B)?
Legal insider trading, particularly when it’s bullish, is particularly usable when the company we’re looking at has experienced transactions within the past six months. Over the last six-month time period, Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B) has experienced zero unique insiders buying, and zero 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 Centrais Eletricas Brasileiras SA (ADR) (NYSE:EBR.B). These stocks are TECO Energy, Inc. (NYSE:TE), Brookfield Infrastructure Partners L.P. (NYSE:BIP), Companhia Paranaense de Energia (ADR) (NYSE:ELP), Pepco Holdings, Inc. (NYSE:POM), and ITC Holdings Corp. (NYSE:ITC). All of these stocks are in the electric utilities industry and their market caps are closest to EBR’s market cap.