Is Cloud Peak Energy Inc. (CLD) Going to Burn These Hedge Funds?

Is Cloud Peak Energy Inc. (NYSE:CLD) ready to rally soon? The best stock pickers are in a pessimistic mood. The number of long hedge fund positions were trimmed by 2 recently.

Cloud Peak Energy Inc. (NYSE:CLD)To the average investor, there are plenty of methods shareholders can use to track the equity markets. Two of the best are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top fund managers can outperform their index-focused peers by a significant amount (see just how much).

Equally as integral, optimistic insider trading sentiment is a second way to parse down the financial markets. As the old adage goes: there are lots of incentives for a corporate insider to downsize shares of his or her company, but just one, very obvious reason why they would initiate a purchase. Various empirical studies have demonstrated the market-beating potential of this tactic if “monkeys” understand what to do (learn more here).

Consequently, it’s important to take a peek at the latest action regarding Cloud Peak Energy Inc. (NYSE:CLD).

How have hedgies been trading Cloud Peak Energy Inc. (NYSE:CLD)?

Heading into Q2, a total of 16 of the hedge funds we track held long positions in this stock, a change of -11% from the first quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were upping their stakes considerably.

Of the funds we track, Robert Bishop’s Impala Asset Management had the most valuable position in Cloud Peak Energy Inc. (NYSE:CLD), worth close to $72 million, accounting for 3.8% of its total 13F portfolio. On Impala Asset Management’s heels is Third Avenue Management, managed by Martin Whitman, which held a $39.2 million position; 0.8% of its 13F portfolio is allocated to the company. Other hedge funds that hold long positions include Tom Wagner and Ara Cohen’s Knighthead Capital, John Burbank’s Passport Capital and Kerr Neilson’s Platinum Asset Management.

Judging by the fact that Cloud Peak Energy Inc. (NYSE:CLD) has witnessed falling interest from the entirety of the hedge funds we track, it’s easy to see that there was a specific group of hedgies that slashed their full holdings at the end of the first quarter. At the top of the heap, Neil Chriss’s Hutchin Hill Capital dropped the biggest position of the “upper crust” of funds we track, valued at an estimated $2.9 million in stock.. D. E. Shaw’s fund, D E Shaw, also sold off its stock, about $2.3 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest dropped by 2 funds at the end of the first quarter.

How have insiders been trading Cloud Peak Energy Inc. (NYSE:CLD)?

Insider buying is particularly usable when the company in question has experienced transactions within the past half-year. Over the latest six-month time frame, Cloud Peak Energy Inc. (NYSE:CLD) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).

Let’s also take a look at hedge fund and insider activity in other stocks similar to Cloud Peak Energy Inc. (NYSE:CLD). These stocks are Stillwater Mining Company (NYSE:SWC), AMCOL International Corporation (NYSE:ACO), Globe Specialty Metals, Inc. (NASDAQ:GSM), U.S. Silica Holdings Inc (NYSE:SLCA), and Arch Coal Inc (NYSE:ACI). This group of stocks belong to the industrial metals & minerals industry and their market caps are closest to CLD’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Stillwater Mining Company (NYSE:SWC) 17 1 5
AMCOL International Corporation (NYSE:ACO) 4 0 9
Globe Specialty Metals, Inc. (NASDAQ:GSM) 10 0 0
U.S. Silica Holdings Inc (NYSE:SLCA) 14 0 6
Arch Coal Inc (NYSE:ACI) 20 1 0

With the results exhibited by our strategies, retail investors should always keep an eye on hedge fund and insider trading activity, and Cloud Peak Energy Inc. (NYSE:CLD) is no exception.

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