Stratasys, Ltd. (NASDAQ:SSYS) has seen a decrease in support from the world’s most elite money managers of late.
In the eyes of most shareholders, hedge funds are viewed as underperforming, old financial tools of the past. While there are greater than 8000 funds with their doors open at present, we hone in on the top tier of this group, close to 450 funds. It is estimated that this group oversees the lion’s share of the smart money’s total capital, and by tracking their top equity investments, we have identified a few investment strategies that have historically outpaced the market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve began to 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 (explore the details and some picks here).
Equally as integral, positive insider trading sentiment is a second way to parse down the marketplace. As the old adage goes: there are many incentives for a corporate insider to drop shares of his or her company, but only one, very clear reason why they would buy. Several academic studies have demonstrated the useful potential of this method if shareholders understand what to do (learn more here).
With these “truths” under our belt, it’s important to take a glance at the latest action encompassing Stratasys, Ltd. (NASDAQ:SSYS).
What does the smart money think about Stratasys, Ltd. (NASDAQ:SSYS)?
Heading into Q2, a total of 12 of the hedge funds we track were bullish in this stock, a change of 0% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were boosting their stakes significantly.
Of the funds we track, Tiger Global Management LLC, managed by Chase Coleman and Feroz Dewan, holds the biggest position in Stratasys, Ltd. (NASDAQ:SSYS). Tiger Global Management LLC has a $96.5 million position in the stock, comprising 1.5% of its 13F portfolio. Coming in second is Chuck Royce of Royce & Associates, with a $21.5 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining peers that are bullish include Drew Cupps’s Cupps Capital Management, Richard Driehaus’s Driehaus Capital and Ken Griffin’s Citadel Investment Group.
Judging by the fact that Stratasys, Ltd. (NASDAQ:SSYS) has faced declining sentiment from the smart money, it’s easy to see that there were a few hedgies that slashed their positions entirely in Q1. Intriguingly, D. E. Shaw’s D E Shaw dropped the largest stake of all the hedgies we monitor, valued at about $3.2 million in call options. Ken Griffin’s fund, Citadel Investment Group, also cut its stock, about $1.7 million worth. These moves are important to note, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
How are insiders trading Stratasys, Ltd. (NASDAQ:SSYS)?
Insider trading activity, especially when it’s bullish, is most useful when the company in focus has experienced transactions within the past half-year. Over the latest six-month time frame, Stratasys, Ltd. (NASDAQ:SSYS) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Stratasys, Ltd. (NASDAQ:SSYS). These stocks are Electronics For Imaging, Inc. (NASDAQ:EFII), Logitech International SA (USA) (NASDAQ:LOGI), Synaptics, Incorporated (NASDAQ:SYNA), Universal Display Corporation (NASDAQ:PANL), and Nice Systems Ltd (ADR) (NASDAQ:NICE). This group of stocks belong to the computer peripherals industry and their market caps match SSYS’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Electronics For Imaging, Inc. (NASDAQ:EFII) | 14 | 0 | 3 |
| Logitech International SA (USA) (NASDAQ:LOGI) | 10 | 1 | 1 |
| Synaptics, Incorporated (NASDAQ:SYNA) | 11 | 0 | 9 |
| Universal Display Corporation (NASDAQ:PANL) | 14 | 1 | 1 |
| Nice Systems Ltd (ADR) (NASDAQ:NICE) | 14 | 0 | 0 |
With the returns shown by Insider Monkey’s time-tested strategies, retail investors should always pay attention to hedge fund and insider trading activity, and Stratasys, Ltd. (NASDAQ:SSYS) is an important part of this process.
