Is Nortek Inc (NASDAQ:NTK) a first-rate stock to buy now? Money managers are becoming less confident. The number of long hedge fund positions were trimmed by 1 lately.
In today’s marketplace, there are tons of methods investors can use to watch their holdings. Some of the most under-the-radar are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite hedge fund managers can outperform the broader indices by a very impressive amount (see just how much).
Equally as beneficial, bullish insider trading sentiment is another way to break down the investments you’re interested in. Obviously, there are a number of motivations for an insider to downsize shares of his or her company, but only one, very clear reason why they would buy. Several empirical studies have demonstrated the market-beating potential of this method if piggybackers know what to do (learn more here).
With all of this in mind, it’s important to take a look at the key action surrounding Nortek Inc (NASDAQ:NTK).
What have hedge funds been doing with Nortek Inc (NASDAQ:NTK)?
At the end of the fourth quarter, a total of 6 of the hedge funds we track were long in this stock, a change of -14% from the previous quarter. With hedge funds’ sentiment swirling, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes meaningfully.
According to our comprehensive database, Jeffrey Gates’s Gates Capital Management had the biggest position in Nortek Inc (NASDAQ:NTK), worth close to $132.1 million, comprising 8.3% of its total 13F portfolio. Coming in second is Anchorage Advisors, managed by Kevin Michael Ulrich, which held a $90.6 million position; 3.3% of its 13F portfolio is allocated to the company. Remaining peers that are bullish include Meridee A. Moore’s Watershed Asset Management, Joel Greenblatt’s Gotham Asset Management and D. E. Shaw’s D E Shaw.
Due to the fact that Nortek Inc (NASDAQ:NTK) has faced falling interest from the smart money, it’s easy to see that there lies a certain “tier” of hedge funds that decided to sell off their entire stakes in Q4. At the top of the heap, Nancy Havens-Hasty’s Havens Advisors dropped the largest position of the “upper crust” of funds we watch, comprising about $1.8 million in stock. These bearish behaviors are interesting, as total hedge fund interest dropped by 1 funds in Q4.
Insider trading activity in Nortek Inc (NASDAQ:NTK)
Insider buying is best served when the company in focus has seen transactions within the past half-year. Over the last 180-day time period, Nortek Inc (NASDAQ:NTK) has seen zero unique insiders purchasing, and 1 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Nortek Inc (NASDAQ:NTK). These stocks are Griffon Corporation (NYSE:GFF), Universal Forest Products, Inc. (NASDAQ:UFPI), Headwaters Inc (NYSE:HW), Apogee Enterprises, Inc. (NASDAQ:APOG), and Trex Company, Inc. (NYSE:TREX). All of these stocks are in the general building materials industry and their market caps are closest to NTK’s market cap.