The TJX Companies, Inc. (NYSE:TJX) investors should watch this data.
To many of your fellow readers, hedge funds are assumed to be bloated, old financial vehicles of an era lost to time. Although there are over 8,000 hedge funds trading in present day, this site looks at the top tier of this club, around 525 funds. It is assumed that this group oversees the lion’s share of the hedge fund industry’s total assets, and by watching their highest quality equity investments, we’ve unearthed a few investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per year 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 topped the S&P 500 index by 33 percentage points in 11 months (find the details here).
Just as necessary, positive insider trading activity is a second way to analyze the marketplace. Just as you’d expect, there are lots of stimuli for an upper level exec to downsize shares of his or her company, but only one, very simple reason why they would buy. Several academic studies have demonstrated the valuable potential of this tactic if you know where to look (learn more here).
Now that that’s out of the way, it’s important to discuss the newest info surrounding The TJX Companies, Inc. (NYSE:TJX).
How have hedgies been trading The TJX Companies, Inc. (NYSE:TJX)?
At the end of the second quarter, a total of 32 of the hedge funds we track were bullish in this stock, a change of -14% from the first quarter. With hedgies’ sentiment swirling, there exists a select group of noteworthy hedge fund managers who were increasing their holdings meaningfully.
Out of the hedge funds we follow, Jim Simons’s Renaissance Technologies had the most valuable position in The TJX Companies, Inc. (NYSE:TJX), worth close to $232.2 million, accounting for 0.6% of its total 13F portfolio. The second largest stake is held by Diamond Hill Capital, managed by Ric Dillon, which held a $165.4 million position; 1.8% of its 13F portfolio is allocated to the company. Other peers that hold long positions include D. E. Shaw’s D E Shaw, Gilchrist Berg’s Water Street Capital and Matt McLennan’s First Eagle Investment Management.
Judging by the fact that The TJX Companies, Inc. (NYSE:TJX) has witnessed dropping sentiment from upper-tier hedge fund managers, logic holds that there was a specific group of money managers that decided to sell off their positions entirely in Q1. Interestingly, David Costen Haley’s HBK Investments dumped the largest position of the “upper crust” of funds we track, comprising an estimated $21.7 million in stock. Jeffrey Vinik’s fund, Vinik Asset Management, also sold off its stock, about $15.4 million worth. These bearish behaviors are interesting, as total hedge fund interest dropped by 5 funds in Q1.
What do corporate executives and insiders think about The TJX Companies, Inc. (NYSE:TJX)?
Legal insider trading, particularly when it’s bullish, is most useful when the company in question has experienced transactions within the past six months. Over the last half-year time frame, The TJX Companies, Inc. (NYSE:TJX) has experienced zero unique insiders purchasing, and 7 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 The TJX Companies, Inc. (NYSE:TJX). These stocks are J.C. Penney Company, Inc. (NYSE:JCP), Dillard’s, Inc. (NYSE:DDS), Sears Holdings Corporation (NASDAQ:SHLD), Kohl’s Corporation (NYSE:KSS), and Macy’s, Inc. (NYSE:M). All of these stocks are in the department stores industry and their market caps resemble TJX’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| J.C. Penney Company, Inc. (NYSE:JCP) | 46 | 0 | 2 |
| Dillard’s, Inc. (NYSE:DDS) | 20 | 0 | 2 |
| Sears Holdings Corporation (NASDAQ:SHLD) | 19 | 1 | 1 |
| Kohl’s Corporation (NYSE:KSS) | 28 | 2 | 5 |
| Macy’s, Inc. (NYSE:M) | 35 | 1 | 15 |
Using the returns demonstrated by the previously mentioned research, regular investors should always keep one eye on hedge fund and insider trading sentiment, and The TJX Companies, Inc. (NYSE:TJX) is an important part of this process.
