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Hedge Funds Aren’t Crazy About Gardner Denver, Inc. (GDI) Anymore

Gardner Denver, Inc. (NYSE:GDI) shareholders have witnessed a decrease in enthusiasm from smart money of late.

In the 21st century investor’s toolkit, there are dozens of indicators market participants can use to track the equity markets. A pair of the best are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best investment managers can outperform their index-focused peers by a very impressive amount (see just how much).

Equally as key, positive insider trading sentiment is a second way to break down the world of equities. As the old adage goes: there are plenty of incentives for an executive to cut shares of his or her company, but only one, very obvious reason why they would behave bullishly. Many empirical studies have demonstrated the market-beating potential of this method if “monkeys” know what to do (learn more here).

With all of this in mind, it’s important to take a gander at the latest action regarding Gardner Denver, Inc. (NYSE:GDI).

Hedge fund activity in Gardner Denver, Inc. (NYSE:GDI)

At Q1’s end, a total of 37 of the hedge funds we track held long positions in this stock, a change of -27% from the previous quarter. With the smart money’s sentiment swirling, there exists a select group of noteworthy hedge fund managers who were upping their holdings substantially.

When looking at the hedgies we track, ValueAct Capital, managed by Jeffrey Ubben, holds the biggest position in Gardner Denver, Inc. (NYSE:GDI). ValueAct Capital has a $188.4 million position in the stock, comprising 2.1% of its 13F portfolio. On ValueAct Capital’s heels is Pentwater Capital Management, managed by Matthew Halbower, which held a $105.7 million position; the fund has 4.4% of its 13F portfolio invested in the stock. Remaining hedge funds that are bullish include Mario Gabelli’s GAMCO Investors, John Paulson’s Paulson & Co and John Burbank’s Passport Capital.

Judging by the fact that Gardner Denver, Inc. (NYSE:GDI) has experienced a declination in interest from the smart money, logic holds that there exists a select few money managers that elected to cut their entire stakes last quarter. At the top of the heap, Daniel S. Och’s OZ Management cut the largest position of the “upper crust” of funds we track, totaling about $54.1 million in stock.. Eric Mindich’s fund, Eton Park Capital, also said goodbye to its stock, about $40.4 million worth. These transactions are important to note, as aggregate hedge fund interest dropped by 14 funds last quarter.

How have insiders been trading Gardner Denver, Inc. (NYSE:GDI)?

Insider trading activity, especially when it’s bullish, is at its handiest when the company we’re looking at has experienced transactions within the past half-year. Over the last half-year time period, Gardner Denver, Inc. (NYSE:GDI) has seen zero unique insiders purchasing, and 4 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Gardner Denver, Inc. (NYSE:GDI). These stocks are Nordson Corporation (NASDAQ:NDSN), Crane Co. (NYSE:CR), Babcock & Wilcox Co (NYSE:BWC), Graco Inc. (NYSE:GGG), and SPX Corporation (NYSE:SPW). All of these stocks are in the diversified machinery industry and their market caps are closest to GDI’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Nordson Corporation (NASDAQ:NDSN) 18 1 2
Crane Co. (NYSE:CR) 25 0 9
Babcock & Wilcox Co (NYSE:BWC) 27 1 1
Graco Inc. (NYSE:GGG) 12 0 12
SPX Corporation (NYSE:SPW) 16 1 6

With the returns exhibited by the aforementioned strategies, retail investors should always monitor hedge fund and insider trading activity, and Gardner Denver, Inc. (NYSE:GDI) is no exception.

Click here to learn why you should track hedge funds

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