Constellation Brands, Inc. (STZ): Insiders Aren’t Crazy About It

Is Constellation Brands, Inc. (NYSE:STZ) ready to rally soon? Hedge funds are getting more optimistic. The number of bullish hedge fund positions went up by 18 in recent months.

According to most investors, hedge funds are viewed as underperforming, old investment tools of the past. While there are more than 8000 funds with their doors open at the moment, we look at the masters of this club, close to 450 funds. It is widely believed that this group oversees the lion’s share of the smart money’s total asset base, and by tracking their best investments, we have figured out a number of investment strategies that have historically outstripped the S&P 500 index. Our small-cap hedge fund strategy outstripped 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 outperformed the S&P 500 index by 23.3 percentage points in 8 months (see the details here).

Constellation Brands, Inc. (NYSE:STZ)Equally as beneficial, bullish insider trading activity is another way to break down the world of equities. There are plenty of stimuli for an upper level exec to drop shares of his or her company, but only one, very clear reason why they would buy. Plenty of academic studies have demonstrated the valuable potential of this method if investors know what to do (learn more here).

Now, we’re going to take a gander at the latest action surrounding Constellation Brands, Inc. (NYSE:STZ).

Hedge fund activity in Constellation Brands, Inc. (NYSE:STZ)

In preparation for this quarter, a total of 57 of the hedge funds we track held long positions in this stock, a change of 46% from the first quarter. With hedgies’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings substantially.

Of the funds we track, Eagle Capital Management, managed by Boykin Curry, holds the largest position in Constellation Brands, Inc. (NYSE:STZ). Eagle Capital Management has a $328.4 million position in the stock, comprising 2% of its 13F portfolio. Sitting at the No. 2 spot is Michael Lowenstein of Kensico Capital, with a $295.5 million position; the fund has 7.9% of its 13F portfolio invested in the stock. Remaining hedge funds with similar optimism include Kenneth Mario Garschina’s Mason Capital Management, and Keith Meister’s Corvex Capital.

As aggregate interest increased, key money managers have been driving this bullishness. Eagle Capital Management, managed by Boykin Curry, created the most valuable position in Constellation Brands, Inc. (NYSE:STZ). Eagle Capital Management had 328.4 million invested in the company at the end of the quarter. Kenneth Mario Garschina’s Mason Capital Management also initiated a $172.3 million position during the quarter. The other funds with brand new STZ positions are Keith Meister’s Corvex Capital, Thomas Steyer’s Farallon Capital, and Doug Silverman and Alexander Klabin’s Senator Investment Group.

Insider trading activity in Constellation Brands, Inc. (NYSE:STZ)

Insider buying is particularly usable when the company in question has seen transactions within the past six months. Over the latest half-year time period, Constellation Brands, Inc. (NYSE:STZ) has seen zero unique insiders purchasing, and 9 insider sales (see the details of insider trades here).

With the results shown by Insider Monkey’s tactics, everyday investors must always keep an eye on hedge fund and insider trading activity, and Constellation Brands, Inc. (NYSE:STZ) shareholders fit into this picture quite nicely.

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