Is Alaska Air Group, Inc. (NYSE:ALK) an exceptional investment right now? Hedge funds are in an optimistic mood. The number of long hedge fund bets moved up by 2 lately.
In today’s marketplace, there are dozens of indicators investors can use to analyze their holdings. A duo of the most underrated are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best money managers can outperform their index-focused peers by a superb margin (see just how much).
Just as integral, optimistic insider trading activity is another way to parse down the marketplace. There are lots of reasons for a corporate insider to get rid of shares of his or her company, but only one, very clear reason why they would initiate a purchase. Several academic studies have demonstrated the impressive potential of this strategy if shareholders understand where to look (learn more here).
With these “truths” under our belt, it’s important to take a look at the latest action encompassing Alaska Air Group, Inc. (NYSE:ALK).
What have hedge funds been doing with Alaska Air Group, Inc. (NYSE:ALK)?
In preparation for this quarter, a total of 24 of the hedge funds we track were bullish in this stock, a change of 9% from the first quarter. With the smart money’s capital changing hands, there exists a few key hedge fund managers who were upping their holdings significantly.
According to our comprehensive database, Jim Simons’s Renaissance Technologies had the most valuable position in Alaska Air Group, Inc. (NYSE:ALK), worth close to $285.2 million, accounting for 0.7% of its total 13F portfolio. Coming in second is PAR Capital Management, managed by Paul Reeder and Edward Shapiro, which held a $265 million position; the fund has 8.3% of its 13F portfolio invested in the stock. Other hedge funds that hold long positions include Robert Bishop’s Impala Asset Management, Cliff Asness’s AQR Capital Management and Quincy Lee’s Ancient Art (Teton Capital).
As one would reasonably expect, specific money managers were breaking ground themselves. Altimeter Capital Management, managed by Brad Gerstner, established the largest position in Alaska Air Group, Inc. (NYSE:ALK). Altimeter Capital Management had 12.6 million invested in the company at the end of the quarter. Andrew Sandler’s Sandler Capital Management also made a $8.3 million investment in the stock during the quarter. The following funds were also among the new ALK investors: SAC Subsidiary’s Sigma Capital Management, D. E. Shaw’s D E Shaw, and Ken Grossman and Glen Schneider’s SG Capital Management.
What do corporate executives and insiders think about Alaska Air Group, Inc. (NYSE:ALK)?
Bullish insider trading is most useful when the company in question has seen transactions within the past half-year. Over the latest 180-day time frame, Alaska Air Group, Inc. (NYSE:ALK) has experienced zero unique insiders buying, and 10 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Alaska Air Group, Inc. (NYSE:ALK). These stocks are Allegiant Travel Company (NASDAQ:ALGT), LATAM Airlines Group SA (ADR) (NYSE:LFL), JetBlue Airways Corporation (NASDAQ:JBLU), Southwest Airlines Co. (NYSE:LUV), and Copa Holdings, S.A. (NYSE:CPA). This group of stocks are in the regional airlines industry and their market caps are similar to ALK’s market cap.