Is NextEra Energy, Inc. (NYSE:NEE) the right pick for your portfolio? Money managers are turning less bullish. The number of long hedge fund bets were cut by 2 in recent months.
In the eyes of most investors, hedge funds are viewed as underperforming, outdated investment tools of yesteryear. While there are more than 8000 funds with their doors open at present, we at Insider Monkey choose to focus on the elite of this group, close to 450 funds. It is widely believed that this group controls most of all hedge funds’ total capital, and by keeping an eye on their top stock picks, we have figured out a number of investment strategies that have historically outpaced Mr. Market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have trumped the S&P 500 index by 23.3 percentage points in 8 months (explore the details and some picks here).
Keeping this in mind, let’s take a gander at the key action encompassing NextEra Energy, Inc. (NYSE:NEE).
How are hedge funds trading NextEra Energy, Inc. (NYSE:NEE)?
At the end of the first quarter, a total of 18 of the hedge funds we track were long in this stock, a change of -10% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were increasing their holdings substantially.
Of the funds we track, Phill Gross and Robert Atchinson’s Adage Capital Management had the most valuable position in NextEra Energy, Inc. (NYSE:NEE), worth close to $154.4 million, accounting for 0.5% of its total 13F portfolio. On Adage Capital Management’s heels is Israel Englander of Millennium Management, with a $113.9 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Some other hedgies that are bullish include Clint Carlson’s Carlson Capital, Bernard Horn’s Polaris Capital Management and David Harding’s Winton Capital Management.
Due to the fact that NextEra Energy, Inc. (NYSE:NEE) has witnessed a declination in interest from the aggregate hedge fund industry, logic holds that there is a sect of hedge funds that decided to sell off their positions entirely heading into Q2. At the top of the heap, Daniel S. Och’s OZ Management dumped the largest position of the “upper crust” of funds we key on, totaling about $5.4 million in stock.. SAC Subsidiary’s fund, CR Intrinsic Investors, also said goodbye to its stock, about $5.2 million worth. These bearish behaviors are important to note, as total hedge fund interest fell by 2 funds heading into Q2.
What do corporate executives and insiders think about NextEra Energy, Inc. (NYSE:NEE)?
Insider trading activity, especially when it’s bullish, is at its handiest when the company in focus has seen transactions within the past 180 days. Over the latest half-year time frame, NextEra Energy, Inc. (NYSE:NEE) has experienced zero unique insiders buying, and 7 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 NextEra Energy, Inc. (NYSE:NEE). These stocks are PG&E Corporation (NYSE:PCG), Duke Energy Corp (NYSE:DUK), American Electric Power Company, Inc. (NYSE:AEP), The Southern Company (NYSE:SO), and Dominion Resources, Inc. (NYSE:D). All of these stocks are in the electric utilities industry and their market caps match NEE’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| PG&E Corporation (NYSE:PCG) | 11 | 0 | 7 |
| Duke Energy Corp (NYSE:DUK) | 18 | 1 | 7 |
| American Electric Power Company, Inc. (NYSE:AEP) | 21 | 1 | 0 |
| The Southern Company (NYSE:SO) | 14 | 1 | 4 |
| Dominion Resources, Inc. (NYSE:D) | 13 | 1 | 3 |
With the results shown by Insider Monkey’s tactics, everyday investors must always keep an eye on hedge fund and insider trading activity, and NextEra Energy, Inc. (NYSE:NEE) is no exception.
