L-3 Communications Holdings, Inc. (NYSE:LLL) has seen a decrease in activity from the world’s largest hedge funds lately.
To the average investor, there are plenty of methods shareholders can use to watch the equity markets. Some of the best 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 investment managers can outclass the market by a healthy margin (see just how much).
Just as key, positive insider trading sentiment is a second way to break down the world of equities. There are many stimuli for a bullish insider to downsize shares of his or her company, but just one, very simple reason why they would behave bullishly. Plenty of academic studies have demonstrated the valuable potential of this strategy if “monkeys” know what to do (learn more here).
With these “truths” under our belt, it’s important to take a gander at the latest action surrounding L-3 Communications Holdings, Inc. (NYSE:LLL).
Hedge fund activity in L-3 Communications Holdings, Inc. (NYSE:LLL)
At the end of the first quarter, a total of 14 of the hedge funds we track held long positions in this stock, a change of -7% from the previous quarter. With hedge funds’ capital changing hands, there exists a select group of notable hedge fund managers who were upping their stakes meaningfully.
Of the funds we track, Richard S. Pzena’s Pzena Investment Management had the most valuable position in L-3 Communications Holdings, Inc. (NYSE:LLL), worth close to $265.6 million, accounting for 1.9% of its total 13F portfolio. On Pzena Investment Management’s heels is AQR Capital Management, managed by Cliff Asness, which held a $39 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Some other hedge funds with similar optimism include David Harding’s Winton Capital Management, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and Ken Griffin’s Citadel Investment Group.
Seeing as L-3 Communications Holdings, Inc. (NYSE:LLL) has faced falling interest from the smart money, it’s safe to say that there were a few hedge funds that elected to cut their entire stakes last quarter. Interestingly, Wojciech Uzdelewicz’s Espalier Global Management said goodbye to the largest position of the 450+ funds we track, worth about $7.7 million in stock.. Israel Englander’s fund, Millennium Management, also said goodbye to its stock, about $6.3 million worth. These transactions are interesting, as total hedge fund interest was cut by 1 funds last quarter.
Insider trading activity in L-3 Communications Holdings, Inc. (NYSE:LLL)
Insider buying is most useful when the company in question has seen transactions within the past six months. Over the last half-year time frame, L-3 Communications Holdings, Inc. (NYSE:LLL) has seen zero unique insiders buying, and 11 insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to L-3 Communications Holdings, Inc. (NYSE:LLL). These stocks are Triumph Group Inc (NYSE:TGI), Rockwell Collins, Inc. (NYSE:COL), B/E Aerospace Inc (NASDAQ:BEAV), Embraer SA (ADR) (NYSE:ERJ), and TransDigm Group Incorporated (NYSE:TDG). All of these stocks are in the aerospace/defense products & services industry and their market caps are similar to LLL’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Triumph Group Inc (NYSE:TGI)||22||2||3|
|Rockwell Collins, Inc. (NYSE:COL)||19||0||12|
|B/E Aerospace Inc (NASDAQ:BEAV)||35||0||9|
|Embraer SA (ADR) (NYSE:ERJ)||11||0||0|
|TransDigm Group Incorporated (NYSE:TDG)||39||1||5|
With the results exhibited by our tactics, retail investors should always monitor hedge fund and insider trading sentiment, and L-3 Communications Holdings, Inc. (NYSE:LLL) is no exception.