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Exterran Holdings, Inc. (NYSE:EXH): Insiders Are Dumping, Should You?

Is Exterran Holdings, Inc. (NYSE:EXH) a buy, sell, or hold? Investors who are in the know are turning bullish. The number of long hedge fund bets inched up by 5 lately.

Exterran Holdings, Inc. (NYSE:EXH)

In the financial world, there are many indicators market participants can use to track the equity markets. A couple of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top hedge fund managers can outclass the S&P 500 by a superb amount (see just how much).

Just as key, bullish insider trading sentiment is another way to parse down the stock market universe. Obviously, there are many reasons for an upper level exec to downsize shares of his or her company, but just one, very clear reason why they would buy. Many empirical studies have demonstrated the market-beating potential of this strategy if “monkeys” understand what to do (learn more here).

Now, it’s important to take a gander at the recent action encompassing Exterran Holdings, Inc. (NYSE:EXH).

What have hedge funds been doing with Exterran Holdings, Inc. (NYSE:EXH)?

At year’s end, a total of 16 of the hedge funds we track held long positions in this stock, a change of 45% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were upping their holdings significantly.

According to our comprehensive database, Carlson Capital, managed by Clint Carlson, holds the biggest position in Exterran Holdings, Inc. (NYSE:EXH). Carlson Capital has a $78 million position in the stock, comprising 1.3% of its 13F portfolio. The second largest stake is held by Chuck Royce of Royce & Associates, with a $21 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Other peers with similar optimism include SAC Subsidiary’s Sigma Capital Management, Ken Griffin’s Citadel Investment Group and Jim Simons’s Renaissance Technologies.

Consequently, specific money managers have jumped into Exterran Holdings, Inc. (NYSE:EXH) headfirst. Renaissance Technologies, managed by Jim Simons, created the largest position in Exterran Holdings, Inc. (NYSE:EXH). Renaissance Technologies had 4 million invested in the company at the end of the quarter. Glenn Russell Dubin’s Highbridge Capital Management also initiated a $2 million position during the quarter. The other funds with brand new EXH positions are John Overdeck and David Siegel’s Two Sigma Advisors, Mike Vranos’s Ellington, and Richard Driehaus’s Driehaus Capital.

How are insiders trading Exterran Holdings, Inc. (NYSE:EXH)?

Insider buying is at its handiest when the primary stock in question has seen transactions within the past six months. Over the latest six-month time frame, Exterran Holdings, Inc. (NYSE:EXH) has seen zero unique insiders buying, and 6 insider sales (see the details of insider trades here).

With the returns demonstrated by the aforementioned strategies, everyday investors should always watch hedge fund and insider trading activity, and Exterran Holdings, Inc. (NYSE:EXH) is no exception.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

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.

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