Is Stewart Enterprises, Inc. (NASDAQ:STEI) a buy right now? Prominent investors are taking an optimistic view. The number of long hedge fund positions moved up by 4 in recent months.
In the financial world, there are dozens of indicators shareholders can use to watch the equity markets. A pair of the most useful 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 outperform their index-focused peers by a solid amount (see just how much).
Equally as important, positive insider trading activity is a second way to break down the financial markets. Just as you’d expect, there are a number of stimuli for an executive to get rid of shares of his or her company, but just one, very simple reason why they would behave bullishly. Plenty of academic studies have demonstrated the impressive potential of this strategy if you know where to look (learn more here).
With these “truths” under our belt, it’s important to take a peek at the latest action encompassing Stewart Enterprises, Inc. (NASDAQ:STEI).
How have hedgies been trading Stewart Enterprises, Inc. (NASDAQ:STEI)?
At the end of the fourth quarter, a total of 14 of the hedge funds we track were bullish in this stock, a change of 40% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were boosting their holdings substantially.
When looking at the hedgies we track, Matthew Halbower’s Pentwater Capital Management had the biggest position in Stewart Enterprises, Inc. (NASDAQ:STEI), worth close to $82.5 million, accounting for 3% of its total 13F portfolio. Sitting at the No. 2 spot is Ascend Capital, managed by Malcolm Fairbairn, which held a $10.8 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Other hedge funds that are bullish include Jane Mendillo’s Harvard Management Co, Cliff Asness’s AQR Capital Management and Israel Englander’s Millennium Management.
As industrywide interest jumped, key hedge funds have jumped into Stewart Enterprises, Inc. (NASDAQ:STEI) headfirst. Renaissance Technologies, managed by Jim Simons, assembled the biggest position in Stewart Enterprises, Inc. (NASDAQ:STEI). Renaissance Technologies had 0.4 million invested in the company at the end of the quarter. Ken Gray and Steve Walsh’s Bryn Mawr Capital also initiated a $0.3 million position during the quarter. The following funds were also among the new STEI investors: Ken Griffin’s Citadel Investment Group, Neil Chriss’s Hutchin Hill Capital, and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.
What have insiders been doing with Stewart Enterprises, Inc. (NASDAQ:STEI)?
Insider buying is at its handiest when the company in question has experienced transactions within the past half-year. Over the latest six-month time period, Stewart Enterprises, Inc. (NASDAQ:STEI) has experienced 1 unique insiders buying, and 5 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Stewart Enterprises, Inc. (NASDAQ:STEI). These stocks are StoneMor Partners L.P. (NYSE:STON), eLong, Inc. (ADR) (NASDAQ:LONG), Regis Corporation (NYSE:RGS), and Steiner Leisure Ltd (NASDAQ:STNR). All of these stocks are in the personal services industry and their market caps are similar to STEI’s market cap.