Resolute Forest Products Inc (NYSE:RFP) was in 20 hedge funds’ portfolio at the end of March. RFP has experienced a decrease in support from the world’s most elite money managers of late. There were 22 hedge funds in our database with RFP positions at the end of the previous quarter.
In the 21st century investor’s toolkit, there are dozens of methods shareholders can use to analyze Mr. Market. A pair of the most useful 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 investment managers can outpace the broader indices by a significant margin (see just how much).
Just as beneficial, positive insider trading sentiment is a second way to parse down the investments you’re interested in. Obviously, there are a number of reasons for an executive to sell shares of his or her company, but just one, very obvious reason why they would buy. Plenty of empirical studies have demonstrated the valuable potential of this tactic if piggybackers understand where to look (learn more here).
With all of this in mind, it’s important to take a gander at the latest action encompassing Resolute Forest Products Inc (NYSE:RFP).
How have hedgies been trading Resolute Forest Products Inc (NYSE:RFP)?
In preparation for this quarter, a total of 20 of the hedge funds we track held long positions in this stock, a change of -9% from one quarter earlier. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were upping their holdings considerably.
According to our comprehensive database, Prem Watsa’s Fairfax Financial Holdings had the biggest position in Resolute Forest Products Inc (NYSE:RFP), worth close to $400.9 million, comprising 15% of its total 13F portfolio. The second largest stake is held by Steelhead Partners, managed by Michael Johnston, which held a $211.7 million position; 16.4% of its 13F portfolio is allocated to the stock. Some other peers with similar optimism include John Paulson’s Paulson & Co, Francis Chou’s Chou Associates Management and Jon Bauer’s Contrarian Capital.
Due to the fact that Resolute Forest Products Inc (NYSE:RFP) has faced falling interest from hedge fund managers, logic holds that there lies a certain “tier” of fund managers that decided to sell off their full holdings at the end of the first quarter. At the top of the heap, Stanley Druckenmiller’s Duquesne Capital cut the biggest position of all the hedgies we watch, totaling close to $5.4 million in stock., and David Moradi of Anthion Management was right behind this move, as the fund sold off about $5 million worth. These moves are important to note, as total hedge fund interest was cut by 2 funds at the end of the first quarter.
What do corporate executives and insiders think about Resolute Forest Products Inc (NYSE:RFP)?
Insider buying is best served when the primary stock in question has experienced transactions within the past six months. Over the last 180-day time period, Resolute Forest Products Inc (NYSE:RFP) has experienced 1 unique insiders purchasing, 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 Resolute Forest Products Inc (NYSE:RFP). These stocks are Buckeye Technologies Inc. (NYSE:BKI), Clearwater Paper Corp (NYSE:CLW), Schweitzer-Mauduit International, Inc. (NYSE:SWM), and KapStone Paper and Packaging Corp. (NYSE:KS). This group of stocks are in the paper & paper products industry and their market caps match RFP’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Buckeye Technologies Inc. (NYSE:BKI)||5||0||5|
|Clearwater Paper Corp (NYSE:CLW)||17||1||0|
|Schweitzer-Mauduit International, Inc. (NYSE:SWM)||14||0||2|
|KapStone Paper and Packaging Corp. (NYSE:KS)||14||0||4|
With the results demonstrated by the aforementioned studies, retail investors should always monitor hedge fund and insider trading sentiment, and Resolute Forest Products Inc (NYSE:RFP) shareholders fit into this picture quite nicely.