American Woodmark Corporation (NASDAQ:AMWD) was in 9 hedge funds’ portfolio at the end of the fourth quarter of 2012. AMWD shareholders have witnessed an increase in enthusiasm from smart money lately. There were 6 hedge funds in our database with AMWD positions at the end of the previous quarter.
In the eyes of most market participants, hedge funds are seen as slow, old financial tools of years past. While there are greater than 8000 funds in operation at the moment, we at Insider Monkey look at the masters of this group, about 450 funds. It is widely believed that this group controls the majority of the hedge fund industry’s total capital, and by keeping an eye on their best investments, we have unsheathed a number of investment strategies that have historically outperformed the broader indices. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points a 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 trumped the S&P 500 index by 24 percentage points in 7 months (check out a sample of our picks).
Equally as integral, optimistic insider trading sentiment is a second way to break down the world of equities. Obviously, there are many stimuli for an executive to sell shares of his or her company, but only one, very simple reason why they would buy. Plenty of academic studies have demonstrated the impressive potential of this method if “monkeys” understand where to look (learn more here).
Keeping this in mind, let’s take a peek at the latest action surrounding American Woodmark Corporation (NASDAQ:AMWD).
What does the smart money think about American Woodmark Corporation (NASDAQ:AMWD)?
Heading into 2013, a total of 9 of the hedge funds we track were bullish in this stock, a change of 50% from the third quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings meaningfully.
Of the funds we track, Chuck Royce’s Royce & Associates had the most valuable position in American Woodmark Corporation (NASDAQ:AMWD), worth close to $35 million, comprising 0.1% of its total 13F portfolio. Sitting at the No. 2 spot is Jim Simons of Renaissance Technologies, with a $7 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Remaining hedgies with similar optimism include Richard Driehaus’s Driehaus Capital, D. E. Shaw’s D E Shaw and Charles Davidson’s Wexford Capital.
As one would reasonably expect, specific money managers were breaking ground themselves. Driehaus Capital, managed by Richard Driehaus, assembled the biggest position in American Woodmark Corporation (NASDAQ:AMWD). Driehaus Capital had 1.7 million invested in the company at the end of the quarter. Steven Cohen’s SAC Capital Advisors also initiated a $0.5 million position during the quarter. The following funds were also among the new AMWD investors: Ken Griffin’s Citadel Investment Group, Mike Vranos’s Ellington, and Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital.
What have insiders been doing with American Woodmark Corporation (NASDAQ:AMWD)?
Insider trading activity, especially when it’s bullish, is at its handiest when the company in focus has seen transactions within the past 180 days. Over the latest half-year time period, American Woodmark Corporation (NASDAQ:AMWD) has seen zero unique insiders buying, and 4 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to American Woodmark Corporation (NASDAQ:AMWD). These stocks are Flexsteel Industries, Inc. (NASDAQ:FLXS), Mattress Firm Holding Corp (NASDAQ:MFRM), Select Comfort Corp. (NASDAQ:SCSS), La-Z-Boy Incorporated (NYSE:LZB), and Ethan Allen Interiors Inc. (NYSE:ETH). This group of stocks are the members of the home furnishings & fixtures industry and their market caps are similar to AMWD’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Flexsteel Industries, Inc. (NASDAQ:FLXS) | 3 | 2 | 2 |
| Mattress Firm Holding Corp (NASDAQ:MFRM) | 8 | 0 | 8 |
| Select Comfort Corp. (NASDAQ:SCSS) | 16 | 0 | 3 |
| La-Z-Boy Incorporated (NYSE:LZB) | 11 | 0 | 5 |
| Ethan Allen Interiors Inc. (NYSE:ETH) | 11 | 0 | 15 |
With the returns demonstrated by Insider Monkey’s tactics, retail investors should always monitor hedge fund and insider trading sentiment, and American Woodmark Corporation (NASDAQ:AMWD) shareholders fit into this picture quite nicely.
