DST Systems, Inc. (NYSE:DST) has seen a decrease in hedge fund sentiment of late.
In today’s marketplace, there are many metrics shareholders can use to track their holdings. A couple 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 best money managers can outclass their index-focused peers by a healthy margin (see just how much).
Just as important, optimistic insider trading sentiment is another way to break down the investments you’re interested in. Obviously, there are a number of reasons for an upper level exec to downsize shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Several academic studies have demonstrated the market-beating potential of this method if investors know what to do (learn more here).
With all of this in mind, let’s take a gander at the recent action encompassing DST Systems, Inc. (NYSE:DST).
Hedge fund activity in DST Systems, Inc. (NYSE:DST)
In preparation for this quarter, a total of 23 of the hedge funds we track were bullish in this stock, a change of 0% from the first quarter. With hedge funds’ capital changing hands, there exists a few key hedge fund managers who were boosting their holdings meaningfully.
Of the funds we track, Greenlight Capital, managed by David Einhorn, holds the biggest position in DST Systems, Inc. (NYSE:DST). Greenlight Capital has a $160 million position in the stock, comprising 2.4% of its 13F portfolio. The second largest stake is held by Matt Sirovich and Jeremy Mindich of Scopia Capital, with a $59.4 million position; the fund has 2.1% of its 13F portfolio invested in the stock. Some other peers that are bullish include Israel Englander’s Millennium Management, Daniel Gold’s QVT Financial and David Dreman’s Dreman Value Management.
Seeing as DST Systems, Inc. (NYSE:DST) has witnessed falling interest from the aggregate hedge fund industry, it’s safe to say that there was a specific group of funds who were dropping their entire stakes last quarter. Intriguingly, Michael Doheny’s Freshford Capital Management said goodbye to the biggest investment of all the hedgies we watch, worth about $13 million in stock.. Matthew Hulsizer’s fund, PEAK6 Capital Management, also dropped its stock, about $0.5 million worth. These transactions are interesting, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
What do corporate executives and insiders think about DST Systems, Inc. (NYSE:DST)?
Bullish insider trading is best served when the company in focus has experienced transactions within the past 180 days. Over the latest six-month time frame, DST Systems, Inc. (NYSE:DST) has seen 1 unique insiders purchasing, and 7 insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to DST Systems, Inc. (NYSE:DST). These stocks are DigitalGlobe Inc (NYSE:DGI), FactSet Research Systems Inc. (NYSE:FDS), Dun & Bradstreet Corp (NYSE:DNB), Broadridge Financial Solutions, Inc. (NYSE:BR), and Morningstar, Inc. (NASDAQ:MORN). This group of stocks are in the information & delivery services industry and their market caps match DST’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|DigitalGlobe Inc (NYSE:DGI)||33||0||4|
|FactSet Research Systems Inc. (NYSE:FDS)||17||0||7|
|Dun & Bradstreet Corp (NYSE:DNB)||14||0||3|
|Broadridge Financial Solutions, Inc. (NYSE:BR)||14||0||9|
|Morningstar, Inc. (NASDAQ:MORN)||8||0||8|
With the results shown by the aforementioned time-tested strategies, retail investors should always watch hedge fund and insider trading sentiment, and DST Systems, Inc. (NYSE:DST) is no exception.