Primerica, Inc. (NYSE:PRI) investors should be aware of a decrease in hedge fund interest lately.
In the eyes of most market participants, hedge funds are seen as slow, outdated financial vehicles of the past. While there are more than 8000 funds trading at the moment, we choose to focus on the top tier of this club, around 450 funds. It is widely believed that this group has its hands on the majority of all hedge funds’ total capital, and by monitoring their highest performing investments, we have come up with a number of investment strategies that have historically outperformed the broader indices. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per year for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have outperformed the S&P 500 index by 23.3 percentage points in 8 months (check out a sample of our picks).
Equally as integral, bullish insider trading sentiment is a second way to break down the stock market universe. There are a number of motivations for an insider to downsize shares of his or her company, but just one, very simple reason why they would initiate a purchase. Many empirical studies have demonstrated the market-beating potential of this method if shareholders know where to look (learn more here).
Consequently, it’s important to take a glance at the key action surrounding Primerica, Inc. (NYSE:PRI).
What does the smart money think about Primerica, Inc. (NYSE:PRI)?
Heading into Q2, a total of 12 of the hedge funds we track held long positions in this stock, a change of -20% from the previous quarter. With hedge funds’ sentiment swirling, there exists a select group of key hedge fund managers who were boosting their holdings considerably.
When looking at the hedgies we track, Brave Warrior Capital, managed by Glenn Greenberg, holds the biggest position in Primerica, Inc. (NYSE:PRI). Brave Warrior Capital has a $108.5 million position in the stock, comprising 5.7% of its 13F portfolio. Coming in second is D. E. Shaw of D E Shaw, with a $37.4 million position; 0.1% of its 13F portfolio is allocated to the company. Other peers that hold long positions include Richard S. Pzena’s Pzena Investment Management, Ken Griffin’s Citadel Investment Group and Anthony Bozza’s Lakewood Capital Management.
Due to the fact that Primerica, Inc. (NYSE:PRI) has experienced a declination in interest from the aggregate hedge fund industry, logic holds that there was a specific group of hedgies who sold off their full holdings last quarter. Intriguingly, Phill Gross and Robert Atchinson’s Adage Capital Management dumped the biggest position of the 450+ funds we watch, valued at close to $1.8 million in stock., and John Overdeck and David Siegel of Two Sigma Advisors was right behind this move, as the fund dumped about $1.2 million worth. These moves are important to note, as aggregate hedge fund interest dropped by 3 funds last quarter.
Insider trading activity in Primerica, Inc. (NYSE:PRI)
Bullish insider trading is particularly usable when the company in question has seen transactions within the past half-year. Over the last half-year time period, Primerica, Inc. (NYSE:PRI) has experienced zero unique insiders purchasing, and 12 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Primerica, Inc. (NYSE:PRI). These stocks are Reinsurance Group of America Inc (NYSE:RGA), Aviva Plc (ADR) (NYSE:AV), American Equity Investment Life Holding (NYSE:AEL), Protective Life Corp. (NYSE:PL), and Symetra Financial Corporation (NYSE:SYA). All of these stocks are in the life insurance industry and their market caps match PRI’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Reinsurance Group of America Inc (NYSE:RGA)||19||0||5|
|Aviva Plc (ADR) (NYSE:AV)||1||0||0|
|American Equity Investment Life Holding (NYSE:AEL)||13||1||4|
|Protective Life Corp. (NYSE:PL)||14||0||3|
|Symetra Financial Corporation (NYSE:SYA)||15||0||1|
With the results exhibited by the aforementioned tactics, everyday investors must always pay attention to hedge fund and insider trading sentiment, and Primerica, Inc. (NYSE:PRI) is an important part of this process.