Is Exelis Inc (XLS) Going to Burn These Hedge Funds?

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Exelis Inc (NYSE:XLS) was in 21 hedge funds’ portfolio at the end of March. XLS has seen a decrease in enthusiasm from smart money in recent months. There were 22 hedge funds in our database with XLS positions at the end of the previous quarter.

Exelis Inc (NYSE:XLS)

At the moment, there are dozens of gauges market participants can use to track the equity markets. Some of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best hedge fund managers can trounce the broader indices by a very impressive amount (see just how much).

Just as key, bullish insider trading sentiment is another way to parse down the world of equities. Obviously, there are a number of stimuli for an upper level exec to cut shares of his or her company, but only one, very clear reason why they would behave bullishly. Many empirical studies have demonstrated the market-beating potential of this method if “monkeys” understand where to look (learn more here).

Consequently, we’re going to take a gander at the key action encompassing Exelis Inc (NYSE:XLS).

How have hedgies been trading Exelis Inc (NYSE:XLS)?

At Q1’s end, a total of 21 of the hedge funds we track held long positions in this stock, a change of -5% from the first quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were upping their stakes significantly.

Of the funds we track, Levin Capital Strategies, managed by John A. Levin, holds the biggest position in Exelis Inc (NYSE:XLS). Levin Capital Strategies has a $39.6 million position in the stock, comprising 0.7% of its 13F portfolio. The second largest stake is held by GAMCO Investors, managed by Mario Gabelli, which held a $22.2 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other hedgies with similar optimism include Ken Griffin’s Citadel Investment Group, D. E. Shaw’s D E Shaw and Israel Englander’s Millennium Management.

Seeing as Exelis Inc (NYSE:XLS) has faced declining sentiment from the entirety of the hedge funds we track, logic holds that there is a sect of funds who were dropping their full holdings heading into Q2. At the top of the heap, Louis Bacon’s Moore Global Investments sold off the biggest investment of the 450+ funds we key on, comprising about $1.7 million in stock., and Michael Price of MFP Investors was right behind this move, as the fund sold off about $1.2 million worth. These transactions are intriguing to say the least, as total hedge fund interest was cut by 1 funds heading into Q2.

What do corporate executives and insiders think about Exelis Inc (NYSE:XLS)?

Insider purchases made by high-level executives is best served when the company in question has seen transactions within the past half-year. Over the last 180-day time frame, Exelis Inc (NYSE:XLS) has experienced zero unique insiders purchasing, and 4 insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Exelis Inc (NYSE:XLS). These stocks are Alcatel Lucent SA (ADR) (NYSE:ALU), Ciena Corporation (NASDAQ:CIEN), ViaSat, Inc. (NASDAQ:VSAT), Arris Group, Inc. (NASDAQ:ARRS), and Acme Packet, Inc. (NASDAQ:APKT). This group of stocks belong to the communication equipment industry and their market caps resemble XLS’s market cap.

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