Insider ValueAct Capital Trims Stake In Adobe Systems Incorporated (ADBE), Has The Ceiling Been Hit?

What does the smart money think about Adobe Systems Incorporated (NASDAQ:ADBE)?

Heading into the second quarter, a total of 37 of the hedge funds tracked by Insider Monkey held long positions in this stock, a drop of 20% from the previous quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were increasing their stakes meaningfully.

According to hedge fund intelligence website Insider Monkey, ValueAct Capital has the most valuable position in Adobe Systems Incorporated (NASDAQ:ADBE). The second-largest stake is held by Stephen Mandel of Lone Pine Capital, with an $890.6 million position; the fund has 3.4% of its 13F portfolio invested in the stock. Some other peers with similar optimism encompass Lee Ainslie‘s Maverick Capital, John Smith Clark’s Southpoint Capital Advisors and David Stemerman‘s Conatus Capital Management.

Since Adobe Systems Incorporated (NASDAQ:ADBE) has witnessed bearish sentiment from hedge fund managers, logic holds that there lies a certain “tier” of fund managers that decided to sell off their full holdings heading into the second trimester. Interestingly, Christopher Medlock James’ Partner Fund Management said goodbye to the biggest stake of the “upper crust” of funds monitored by Insider Monkey, totaling about $79.2 million in stock. Philippe Laffont’s fund, Coatue Management, also sold off its position, about $67 million worth. These moves are important to note, as total hedge fund interest dropped by nine funds heading into the second quarter.

While it’s not the first time Ubben has sold shares, nor is it a particularly large amount given his stake, it should be consider nonetheless in any evaluation of whether Adobe is reaching the upper limits of its value and it’s wiser to look elsewhere for good stocks to invest in. Based on the smart money’s actions, we would say that is indeed the case and the ceiling has been hit.

Disclosure: None