To the average investor, there are a multitude of gauges shareholders can use to analyze their holdings. Two of the most useful are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite investment managers can outperform the S&P 500 by a superb amount (see just how much).
Equally as crucial, bullish insider trading activity is a second way to look at the financial markets. There are many stimuli for an executive to drop shares of his or her company, but just one, very simple reason why they would buy. Various academic studies have demonstrated the valuable potential of this tactic if shareholders understand what to do (learn more here).
What’s more, let’s examine the newest info for Hospira, Inc. (NYSE:HSP).
What does the smart money think about Hospira, Inc. (NYSE:HSP)?
At the end of the second quarter, a total of 18 of the hedge funds we track were long in this stock, a change of -14% from the previous quarter. With hedge funds’ capital changing hands, there exists an “upper tier” of key hedge fund managers who were boosting their stakes substantially.
According to our 13F database, Harris Associates, managed by Natixis Global Asset Management, holds the most valuable position in Hospira, Inc. (NYSE:HSP). Harris Associates has a $248.7 million position in the stock, comprising 0.5% of its 13F portfolio. Coming in second is John W. Rogers of Ariel Investments, with a $184.3 million position; the fund has 3% of its 13F portfolio invested in the stock. Remaining hedgies with similar optimism include Larry Robbins’s Glenview Capital, Thomas Ellis and Todd Hammer’s North Run Capital and Richard S. Pzena’s Pzena Investment Management.
As Hospira, Inc. (NYSE:HSP) has experienced a fall in interest from upper-tier hedge fund managers, it’s safe to say that there was a specific group of money managers that decided to sell off their entire stakes in Q1. It’s worth mentioning that Dmitry Balyasny’s Balyasny Asset Management cut the biggest stake of the 450+ funds we track, valued at close to $38.3 million in stock. Frank Brosens’s fund, Taconic Capital, also dropped its stock, about $23 million worth. These transactions are intriguing to say the least, as total hedge fund interest fell by 3 funds in Q1.
How are insiders trading Hospira, Inc. (NYSE:HSP)?
Insider buying made by high-level executives is best served when the company in focus has experienced transactions within the past six months. Over the latest six-month time period, Hospira, Inc. (NYSE:HSP) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We’ll go over the relationship between both of these indicators in other stocks similar to Hospira, Inc. (NYSE:HSP). These stocks are Delcath Systems, Inc. (NASDAQ:DCTH), Petmed Express Inc (NASDAQ:PETS), Valeant Pharmaceuticals Intl Inc (NYSE:VRX), Alkermes Plc (NASDAQ:ALKS), and Elan Corporation, plc (ADR) (NYSE:ELN). This group of stocks are in the drug delivery industry and their market caps match HSP’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Delcath Systems, Inc. (NASDAQ:DCTH)||3||0||0|
|Petmed Express Inc (NASDAQ:PETS)||9||0||0|
|Valeant Pharmaceuticals Intl Inc (NYSE:VRX)||55||0||0|
|Alkermes Plc (NASDAQ:ALKS)||20||0||0|
|Elan Corporation, plc (ADR) (NYSE:ELN)||47||0||0|
Using the results shown by our analyses, average investors should always watch hedge fund and insider trading activity, and Hospira, Inc. (NYSE:HSP) shareholders fit into this picture quite nicely.