Koninklijke Philips Electronics NV (ADR) (NYSE:PHG) shareholders have witnessed an increase in enthusiasm from smart money lately.
To the average investor, there are dozens of indicators investors can use to watch the equity markets. A duo of the best are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite hedge fund managers can trounce their index-focused peers by a significant margin (see just how much).
Equally as beneficial, optimistic insider trading activity is a second way to parse down the stock market universe. As the old adage goes: there are many incentives for an upper level exec to get rid of shares of his or her company, but just one, very obvious reason why they would behave bullishly. Plenty of empirical studies have demonstrated the useful potential of this method if “monkeys” know where to look (learn more here).
Now, it’s important to take a peek at the latest action regarding Koninklijke Philips Electronics NV (ADR) (NYSE:PHG).
How are hedge funds trading Koninklijke Philips Electronics NV (ADR) (NYSE:PHG)?
Heading into 2013, a total of 8 of the hedge funds we track were long in this stock, a change of 14% from the third quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their holdings meaningfully.
When looking at the hedgies we track, Mason Hawkins’s Southeastern Asset Management had the largest position in Koninklijke Philips Electronics NV (ADR) (NYSE:PHG), worth close to $544 million, comprising 2.4% of its total 13F portfolio. The second largest stake is held by Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, which held a $11.9 million position; 0.1% of its 13F portfolio is allocated to the stock. Other hedge funds that hold long positions include D. E. Shaw’s D E Shaw, Ken Griffin’s Citadel Investment Group and Israel Englander’s Millennium Management.
As industrywide interest jumped, specific money managers were leading the bulls’ herd. McKinley Capital Management, managed by Robert B. Gillam, initiated the most outsized position in Koninklijke Philips Electronics NV (ADR) (NYSE:PHG). McKinley Capital Management had 0.2 million invested in the company at the end of the quarter.
How have insiders been trading Koninklijke Philips Electronics NV (ADR) (NYSE:PHG)?
Insider buying is particularly usable when the primary stock in question has experienced transactions within the past half-year. Over the latest half-year time period, Koninklijke Philips Electronics NV (ADR) (NYSE:PHG) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to Koninklijke Philips Electronics NV (ADR) (NYSE:PHG). These stocks are Ingersoll-Rand PLC (NYSE:IR), Kubota Corp (ADR) (NYSE:KUB), Danaher Corporation (NYSE:DHR), Cummins Inc. (NYSE:CMI), and Illinois Tool Works Inc. (NYSE:ITW). This group of stocks belong to the diversified machinery industry and their market caps are similar to PHG’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Ingersoll-Rand PLC (NYSE:IR) | 30 | 1 | 13 |
| Kubota Corp (ADR) (NYSE:KUB) | 4 | 0 | 0 |
| Danaher Corporation (NYSE:DHR) | 33 | 0 | 12 |
| Cummins Inc. (NYSE:CMI) | 39 | 0 | 8 |
| Illinois Tool Works Inc. (NYSE:ITW) | 24 | 0 | 10 |
With the returns shown by our research, retail investors should always keep an eye on hedge fund and insider trading activity, and Koninklijke Philips Electronics NV (ADR) (NYSE:PHG) is an important part of this process.
