Green Dot Corporation (NYSE:GDOT) shareholders have witnessed a decrease in hedge fund sentiment of late.
To the average investor, there are dozens of indicators shareholders can use to analyze their holdings. Some of the most underrated are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite investment managers can outpace the broader indices by a very impressive margin (see just how much).
Just as key, optimistic insider trading activity is a second way to break down the investments you’re interested in. Obviously, there are a variety of reasons for a corporate insider to get rid of shares of his or her company, but just one, very clear reason why they would behave bullishly. Various empirical studies have demonstrated the useful potential of this strategy if shareholders know where to look (learn more here).
Keeping this in mind, let’s take a glance at the recent action regarding Green Dot Corporation (NYSE:GDOT).
What does the smart money think about Green Dot Corporation (NYSE:GDOT)?
At year’s end, a total of 15 of the hedge funds we track held long positions in this stock, a change of 0% from the third quarter. With the smart money’s sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were boosting their holdings considerably.
According to our comprehensive database, Harvest Capital Strategies, managed by Joseph A. Jolson, holds the biggest position in Green Dot Corporation (NYSE:GDOT). Harvest Capital Strategies has a $13 million position in the stock, comprising 2.4% of its 13F portfolio. Coming in second is Debra Fine of Fine Capital Partners, with a $11 million position; 2.4% of its 13F portfolio is allocated to the stock. Other hedge funds with similar optimism include Ken Grossman and Glen Schneider’s SG Capital Management, Jim Simons’s Renaissance Technologies and Thomas E. Claugus’s GMT Capital.
Because Green Dot Corporation (NYSE:GDOT) has witnessed declining sentiment from the entirety of the hedge funds we track, logic holds that there is a sect of hedge funds who sold off their positions entirely in Q4. It’s worth mentioning that SAC Subsidiary’s CR Intrinsic Investors cut the biggest stake of all the hedgies we track, valued at about $1 million in stock.. Steven Cohen’s fund, SAC Capital Advisors, also cut its stock, about $0 million worth. These bearish behaviors are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
How have insiders been trading Green Dot Corporation (NYSE:GDOT)?
Insider buying is most useful when the company in focus has experienced transactions within the past 180 days. Over the last 180-day time period, Green Dot Corporation (NYSE:GDOT) has seen 3 unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Green Dot Corporation (NYSE:GDOT). These stocks are Performant Financial Corp (NASDAQ:PFMT), American Public Education, Inc. (NASDAQ:APEI), Comverse Inc (NASDAQ:CNSI), COMSCORE, Inc. (NASDAQ:SCOR), and Examworks Group, Inc. (NYSE:EXAM). This group of stocks belong to the business services industry and their market caps are similar to GDOT’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Performant Financial Corp (NASDAQ:PFMT)||2||1||10|
|American Public Education, Inc. (NASDAQ:APEI)||5||0||6|
|Comverse Inc (NASDAQ:CNSI)||17||0||0|
|COMSCORE, Inc. (NASDAQ:SCOR)||12||0||1|
|Examworks Group, Inc. (NYSE:EXAM)||8||3||0|
With the results shown by the aforementioned strategies, everyday investors must always monitor hedge fund and insider trading sentiment, and Green Dot Corporation (NYSE:GDOT) applies perfectly to this mantra.
Insider Monkey’s small-cap strategy returned 37% between September 2012 and March 2013 versus 12.9% for the S&P 500 index. Try it now by clicking the link above.