Dycom Industries, Inc. (NYSE:DY): Are Hedge Funds Right About This Stock? – Matrix Service Co (NASDAQ:MTRX), Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD)

Is Dycom Industries, Inc. (NYSE:DY) a buy right now? Money managers are getting less bullish. The number of long hedge fund bets went down by 2 in recent months.

Dycom Industries, Inc. (NYSE:DY)

If you’d ask most stock holders, hedge funds are viewed as unimportant, outdated financial tools of years past. While there are greater than 8000 funds with their doors open at the moment, we choose to focus on the upper echelon of this club, around 450 funds. It is estimated that this group has its hands on the lion’s share of the smart money’s total capital, and by keeping an eye on their highest performing picks, we have spotted a few investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have outperformed the S&P 500 index by 25 percentage points in 6.5 month (see the details here).

Equally as integral, optimistic insider trading activity is another way to parse down the marketplace. Just as you’d expect, there are a number of reasons for a corporate insider to sell shares of his or her company, but just one, very obvious reason why they would buy. Various empirical studies have demonstrated the useful potential of this method if piggybackers understand what to do (learn more here).

Keeping this in mind, we’re going to take a glance at the latest action encompassing Dycom Industries, Inc. (NYSE:DY).

How are hedge funds trading Dycom Industries, Inc. (NYSE:DY)?

In preparation for this year, a total of 11 of the hedge funds we track held long positions in this stock, a change of -15% from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were upping their stakes considerably.

When looking at the hedgies we track, Peconic Partners LLC, managed by William Harnisch, holds the biggest position in Dycom Industries, Inc. (NYSE:DY). Peconic Partners LLC has a $39 million position in the stock, comprising 7.6% of its 13F portfolio. On Peconic Partners LLC’s heels is Cliff Asness of AQR Capital Management, with a $8 million position; the fund has 0% of its 13F portfolio invested in the stock. Remaining hedge funds that hold long positions include D. E. Shaw’s D E Shaw, Jim Simons’s Renaissance Technologies and Ken Grossman and Glen Schneider’s SG Capital Management.

Judging by the fact that Dycom Industries, Inc. (NYSE:DY) has experienced declining sentiment from the entirety of the hedge funds we track, it’s safe to say that there lies a certain “tier” of hedgies that decided to sell off their positions entirely at the end of the year. It’s worth mentioning that Mike Vranos’s Ellington dropped the largest stake of the 450+ funds we monitor, comprising about $1 million in stock.. Ken Brodkowitz and Mike Vermut’s fund, Newland Capital, also said goodbye to its stock, about $1 million worth. These moves are intriguing to say the least, as total hedge fund interest fell by 2 funds at the end of the year.

What do corporate executives and insiders think about Dycom Industries, Inc. (NYSE:DY)?

Insider buying is best served when the company in question has seen transactions within the past half-year. Over the last half-year time frame, Dycom Industries, Inc. (NYSE:DY) has experienced zero unique insiders buying, and 2 insider sales (see the details of insider trades here).

Let’s check out hedge fund and insider activity in other stocks similar to Dycom Industries, Inc. (NYSE:DY). These stocks are Matrix Service Co (NASDAQ:MTRX), Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD), Layne Christensen Company (NASDAQ:LAYN), Tutor Perini Corp (NYSE:TPC), and Aegion Corp – Class A (NASDAQ:AEGN). This group of stocks are in the heavy construction industry and their market caps are similar to DY’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Matrix Service Co (NASDAQ:MTRX) 9 0 3
Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) 14 1 2
Layne Christensen Company (NASDAQ:LAYN) 6 0 2
Tutor Perini Corp (NYSE:TPC) 12 0 2
Aegion Corp – Class A (NASDAQ:AEGN) 10 0 3

With the results demonstrated by Insider Monkey’s research, everyday investors must always monitor hedge fund and insider trading activity, and Dycom Industries, Inc. (NYSE:DY) is no exception.