Colfax Corp (NYSE:CFX) has seen a decrease in hedge fund sentiment of late.
In the 21st century investor’s toolkit, there are dozens of methods market participants can use to analyze publicly traded companies. Some of the most innovative are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite money managers can outperform the broader indices by a solid margin (see just how much).
Equally as key, bullish insider trading sentiment is another way to parse down the marketplace. Just as you’d expect, there are lots of motivations for a corporate insider to sell shares of his or her company, but only one, very obvious reason why they would behave bullishly. Various academic studies have demonstrated the market-beating potential of this strategy if investors understand what to do (learn more here).
With these “truths” under our belt, let’s take a peek at the latest action encompassing Colfax Corp (NYSE:CFX).
How are hedge funds trading Colfax Corp (NYSE:CFX)?
Heading into Q2, a total of 26 of the hedge funds we track were bullish in this stock, a change of 0% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were upping their holdings considerably.
Of the funds we track, Blue Ridge Capital, managed by John Griffin, holds the biggest position in Colfax Corp (NYSE:CFX). Blue Ridge Capital has a $249.9 million position in the stock, comprising 3.1% of its 13F portfolio. On Blue Ridge Capital’s heels is Tiger Global Management LLC, managed by Chase Coleman and Feroz Dewan, which held a $162.9 million position; 2.5% of its 13F portfolio is allocated to the company. Other hedgies with similar optimism include Stephen Mandel’s Lone Pine Capital, Andreas Halvorsen’s Viking Global and Charles Akre’s Akre Capital Management.
Judging by the fact that Colfax Corp (NYSE:CFX) has experienced bearish sentiment from the aggregate hedge fund industry, it’s easy to see that there exists a select few funds that elected to cut their entire stakes at the end of the first quarter. At the top of the heap, Christian Leone’s Luxor Capital Group dumped the largest stake of the 450+ funds we key on, comprising about $35.8 million in stock., and Murray Stahl of Horizon Asset Management was right behind this move, as the fund sold off about $26.4 million worth. These moves are important to note, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
What have insiders been doing with Colfax Corp (NYSE:CFX)?
Bullish insider trading is most useful when the company in question has experienced transactions within the past half-year. Over the last six-month time frame, Colfax Corp (NYSE:CFX) has seen 1 unique insiders purchasing, and 2 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Colfax Corp (NYSE:CFX). These stocks are Xylem Inc (NYSE:XYL), Dresser-Rand Group Inc. (NYSE:DRC), Nordson Corporation (NASDAQ:NDSN), Avery Dennison Corp (NYSE:AVY), and IDEX Corporation (NYSE:IEX). This group of stocks are in the diversified machinery industry and their market caps are similar to CFX’s market cap.