Rowan Companies PLC (NYSE:RDC) has experienced a decrease in activity from the world’s largest hedge funds in recent months.
In the 21st century investor’s toolkit, there are plenty of methods investors can use to watch publicly traded companies. Two of the most under-the-radar are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite hedge fund managers can trounce the broader indices by a healthy margin (see just how much).
Equally as important, optimistic insider trading sentiment is another way to parse down the stock market universe. There are many stimuli for a bullish insider to cut shares of his or her company, but just one, very simple reason why they would behave bullishly. Various academic studies have demonstrated the useful potential of this strategy if you understand what to do (learn more here).
Keeping this in mind, we’re going to take a glance at the latest action encompassing Rowan Companies PLC (NYSE:RDC).
Hedge fund activity in Rowan Companies PLC (NYSE:RDC)
In preparation for this year, a total of 20 of the hedge funds we track were bullish in this stock, a change of 0% from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were increasing their stakes substantially.
Of the funds we track, Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, holds the largest position in Rowan Companies PLC (NYSE:RDC). Arrowstreet Capital has a $228 million position in the stock, comprising 1.2% of its 13F portfolio. On Arrowstreet Capital’s heels is QVT Financial, managed by Daniel Gold, which held a $35 million position; 1.2% of its 13F portfolio is allocated to the company. Remaining peers with similar optimism include Ken Griffin’s Citadel Investment Group, Mario Gabelli’s GAMCO Investors and Steven Cohen’s SAC Capital Advisors.
Due to the fact that Rowan Companies PLC (NYSE:RDC) has experienced declining sentiment from the aggregate hedge fund industry, it’s easy to see that there was a specific group of fund managers that slashed their full holdings in Q4. It’s worth mentioning that Robert Rodriguez and Steven Romick’s First Pacific Advisors LLC dumped the biggest stake of the “upper crust” of funds we track, totaling close to $237 million in stock.. Phill Gross and Robert Atchinson’s fund, Adage Capital Management, also sold off its stock, about $8 million worth. These moves are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
How have insiders been trading Rowan Companies PLC (NYSE:RDC)?
Insider trading activity, especially when it’s bullish, is particularly usable when the company in question has experienced transactions within the past 180 days. Over the last 180-day time frame, Rowan Companies PLC (NYSE:RDC) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
With the results exhibited by Insider Monkey’s strategies, everyday investors should always watch hedge fund and insider trading sentiment, and Rowan Companies PLC (NYSE:RDC) shareholders fit into this picture quite nicely.
Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.