Is Northeast Utilities System (NYSE:NU) a bargain? Hedge funds are getting less bullish. The number of bullish hedge fund positions decreased by 4 recently.
In today’s marketplace, there are many gauges market participants can use to analyze their holdings. Some of the most innovative are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top hedge fund managers can outperform the broader indices by a healthy amount (see just how much).
Just as key, optimistic insider trading activity is another way to break down the world of equities. Obviously, there are plenty of reasons for a corporate insider to sell shares of his or her company, but just one, very simple reason why they would behave bullishly. Plenty of academic studies have demonstrated the impressive potential of this tactic if shareholders know where to look (learn more here).
With all of this in mind, we’re going to take a look at the latest action encompassing Northeast Utilities System (NYSE:NU).
What have hedge funds been doing with Northeast Utilities System (NYSE:NU)?
Heading into 2013, a total of 9 of the hedge funds we track held long positions in this stock, a change of -31% from the third quarter. With hedge funds’ sentiment swirling, there exists an “upper tier” of key hedge fund managers who were boosting their holdings meaningfully.
When looking at the hedgies we track, Phill Gross and Robert Atchinson’s Adage Capital Management had the most valuable position in Northeast Utilities System (NYSE:NU), worth close to $73.8 million, accounting for 0.3% of its total 13F portfolio. Sitting at the No. 2 spot is Millennium Management, managed by Israel Englander, which held a $52.3 million position; 0.3% of its 13F portfolio is allocated to the company. Other hedgies that hold long positions include D. E. Shaw’s D E Shaw, Mario Gabelli’s GAMCO Investors and David Harding’s Winton Capital Management.
Seeing as Northeast Utilities System (NYSE:NU) has faced bearish sentiment from hedge fund managers, it’s easy to see that there exists a select few hedgies that decided to sell off their positions entirely at the end of the year. Intriguingly, Charles Clough’s Clough Capital Partners cut the biggest investment of the 450+ funds we monitor, totaling an estimated $17.1 million in stock., and Jacob Gottlieb of Visium Asset Management was right behind this move, as the fund dropped about $9.2 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest dropped by 4 funds at the end of the year.
Insider trading activity in Northeast Utilities System (NYSE:NU)
Bullish insider trading is at its handiest when the company in question has experienced transactions within the past 180 days. Over the latest 180-day time frame, Northeast Utilities System (NYSE:NU) has seen zero unique insiders buying, and 5 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 Northeast Utilities System (NYSE:NU). These stocks are Ameren Corp (NYSE:AEE), NRG Energy Inc (NYSE:NRG), NiSource Inc. (NYSE:NI), CenterPoint Energy, Inc. (NYSE:CNP), and Public Service Enterprise Group Inc. (NYSE:PEG). This group of stocks belong to the diversified utilities industry and their market caps are similar to NU’s market cap.