Lam Research Corporation (NASDAQ:LRCX) was in 20 hedge funds’ portfolio at the end of December. LRCX shareholders have witnessed a decrease in enthusiasm from smart money recently. There were 23 hedge funds in our database with LRCX holdings at the end of the previous quarter.
To the average investor, there are tons of methods shareholders can use to monitor publicly traded companies. A duo of the best 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 investment managers can trounce their index-focused peers by a significant amount (see just how much).
Equally as important, positive insider trading activity is another way to break down the world of equities. As the old adage goes: there are plenty of stimuli for an insider to cut shares of his or her company, but just one, very obvious reason why they would buy. Several academic studies have demonstrated the useful potential of this tactic if piggybackers understand what to do (learn more here).
With these “truths” under our belt, it’s important to take a look at the recent action regarding Lam Research Corporation (NASDAQ:LRCX).
What does the smart money think about Lam Research Corporation (NASDAQ:LRCX)?
At year’s end, a total of 20 of the hedge funds we track were bullish in this stock, a change of -13% from the third quarter. With the smart money’s sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were boosting their stakes substantially.
Of the funds we track, Eric Bannasch’s Cadian Capital had the largest position in Lam Research Corporation (NASDAQ:LRCX), worth close to $47 million, comprising 1.5% of its total 13F portfolio. On Cadian Capital’s heels is Royce & Associates, managed by Chuck Royce, which held a $45 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other hedge funds that hold long positions include Jim Simons’s Renaissance Technologies, Christopher Lord’s Criterion Capital and D. E. Shaw’s D E Shaw.
Due to the fact that Lam Research Corporation (NASDAQ:LRCX) has experienced falling interest from the smart money, it’s safe to say that there lies a certain “tier” of funds who were dropping their positions entirely last quarter. At the top of the heap, David Tepper’s Appaloosa Management LP dumped the largest stake of the “upper crust” of funds we track, comprising close to $27 million in stock.. John Overdeck and David Siegel’s fund, Two Sigma Advisors, also cut its stock, about $8 million worth. These transactions are interesting, as aggregate hedge fund interest fell by 3 funds last quarter.
How have insiders been trading Lam Research Corporation (NASDAQ:LRCX)?
Insider trading activity, especially when it’s bullish, is most useful when the company in focus has seen transactions within the past half-year. Over the last half-year time frame, Lam Research Corporation (NASDAQ:LRCX) has seen zero unique insiders purchasing, and 1 insider sales (see the details of insider trades here).
With the returns demonstrated by our strategies, everyday investors should always keep an eye on hedge fund and insider trading sentiment, and Lam Research Corporation (NASDAQ:LRCX) applies perfectly to this mantra.
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