Hedge Funds Aren’t Crazy About Hillenbrand, Inc. (HI) Anymore

Hillenbrand, Inc. (NYSE:HI) was in 12 hedge funds’ portfolio at the end of the first quarter of 2013. HI has seen a decrease in hedge fund sentiment recently. There were 18 hedge funds in our database with HI holdings at the end of the previous quarter.

In today’s marketplace, there are dozens of gauges shareholders can use to analyze their holdings. Two of the most innovative are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite money managers can beat their index-focused peers by a significant amount (see just how much).

Equally as beneficial, positive insider trading sentiment is a second way to break down the marketplace. As the old adage goes: there are a variety of stimuli for a corporate insider to drop shares of his or her company, but just one, very simple reason why they would behave bullishly. Plenty of empirical studies have demonstrated the market-beating potential of this tactic if you know where to look (learn more here).

Consequently, it’s important to take a peek at the key action encompassing Hillenbrand, Inc. (NYSE:HI).

How are hedge funds trading Hillenbrand, Inc. (NYSE:HI)?

In preparation for this quarter, a total of 12 of the hedge funds we track were long in this stock, a change of -33% from the first quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were increasing their holdings considerably.

Of the funds we track, Diamond Hill Capital, managed by Ric Dillon, holds the most valuable position in Hillenbrand, Inc. (NYSE:HI). Diamond Hill Capital has a $23.1 million position in the stock, comprising 0.2% of its 13F portfolio. On Diamond Hill Capital’s heels is Dreman Value Management, managed by David Dreman, which held a $12.4 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Remaining peers that are bullish include D. E. Shaw’s D E Shaw, Ken Griffin’s Citadel Investment Group and Chuck Royce’s Royce & Associates.

Because Hillenbrand, Inc. (NYSE:HI) has witnessed declining sentiment from hedge fund managers, it’s easy to see that there was a specific group of fund managers who were dropping their positions entirely at the end of the first quarter. Interestingly, John Overdeck and David Siegel’s Two Sigma Advisors said goodbye to the largest stake of the 450+ funds we key on, worth about $1.3 million in stock.. Ken Brodkowitz and Mike Vermut’s fund, Newland Capital, also dumped its stock, about $1.2 million worth. These moves are interesting, as total hedge fund interest fell by 6 funds at the end of the first quarter.

Insider trading activity in Hillenbrand, Inc. (NYSE:HI)

Insider buying is at its handiest when the primary stock in question has seen transactions within the past half-year. Over the last 180-day time period, Hillenbrand, Inc. (NYSE:HI) has seen 2 unique insiders buying, and 1 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Hillenbrand, Inc. (NYSE:HI). These stocks are Briggs & Stratton Corporation (NYSE:BGG), Polypore International, Inc. (NYSE:PPO), MKS Instruments, Inc. (NASDAQ:MKSI), and AIXTRON SE (ADR) (NASDAQ:AIXG). This group of stocks belong to the diversified machinery industry and their market caps match HI’s market cap.