NetApp Inc. (NASDAQ:NTAP) investors should pay attention to a decrease in support from the world’s most elite money managers lately.
To most stock holders, hedge funds are viewed as unimportant, old investment vehicles of the past. While there are more than 8000 funds in operation today, we at Insider Monkey choose to focus on the leaders of this group, close to 450 funds. It is estimated that this group oversees most of the smart money’s total asset base, and by watching their top investments, we have formulated a few investment strategies that have historically outstripped Mr. Market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points annually 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 23.3 percentage points in 8 months (see the details here).
Equally as integral, positive insider trading activity is a second way to parse down the investments you’re interested in. There are many stimuli for an executive to drop shares of his or her company, but only one, very clear reason why they would buy. Several academic studies have demonstrated the valuable potential of this method if investors know where to look (learn more here).
Consequently, we’re going to take a glance at the latest action surrounding NetApp Inc. (NASDAQ:NTAP).
What have hedge funds been doing with NetApp Inc. (NASDAQ:NTAP)?
In preparation for this quarter, a total of 42 of the hedge funds we track were long in this stock, a change of -19% from the previous quarter. With hedge funds’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were boosting their stakes significantly.
According to our comprehensive database, Matthew Hulsizer’s PEAK6 Capital Management had the largest position in NetApp Inc. (NASDAQ:NTAP), worth close to $1.3664 billion, accounting for 7.5% of its total 13F portfolio. The second largest stake is held by Maverick Capital, managed by Lee Ainslie, which held a $291.2 million position; 3.8% of its 13F portfolio is allocated to the company. Remaining hedge funds that are bullish include Matt Sirovich and Jeremy Mindich’s Scopia Capital, Eric Bannasch’s Cadian Capital and George Soros’s Soros Fund Management.
Seeing as NetApp Inc. (NASDAQ:NTAP) has witnessed bearish sentiment from the entirety of the hedge funds we track, it’s easy to see that there lies a certain “tier” of money managers that slashed their entire stakes heading into Q2. It’s worth mentioning that Ken Griffin’s Citadel Investment Group dumped the biggest investment of the 450+ funds we key on, comprising an estimated $219.3 million in stock.. Ricky Sandler’s fund, Eminence Capital, also cut its stock, about $77.8 million worth. These bearish behaviors are important to note, as total hedge fund interest fell by 10 funds heading into Q2.
How are insiders trading NetApp Inc. (NASDAQ:NTAP)?
Insider purchases made by high-level executives is particularly usable when the company in question has seen transactions within the past six months. Over the latest 180-day time frame, NetApp Inc. (NASDAQ:NTAP) has seen zero unique insiders purchasing, and 4 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to NetApp Inc. (NASDAQ:NTAP). These stocks are Brocade Communications Systems, Inc. (NASDAQ:BRCD), EMC Corporation (NYSE:EMC), SanDisk Corporation (NASDAQ:SNDK), Seagate Technology PLC (NASDAQ:STX), and Western Digital Corp. (NASDAQ:WDC). All of these stocks are in the data storage devices industry and their market caps resemble NTAP’s market cap.