Nordstrom, Inc. (NYSE:JWN) was in 26 hedge funds’ portfolio at the end of December. JWN investors should be aware of a decrease in support from the world’s most elite money managers lately. There were 30 hedge funds in our database with JWN holdings at the end of the previous quarter.
In today’s marketplace, there are plenty of indicators market participants can use to analyze the equity markets. Two of the most innovative are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the best hedge fund managers can outperform the S&P 500 by a significant amount (see just how much).
Just as integral, positive insider trading sentiment is a second way to parse down the marketplace. There are lots of incentives for an insider to downsize shares of his or her company, but just one, very simple reason why they would behave bullishly. Various academic studies have demonstrated the useful potential of this method if investors understand where to look (learn more here).
Consequently, we’re going to take a look at the recent action regarding Nordstrom, Inc. (NYSE:JWN).
What have hedge funds been doing with Nordstrom, Inc. (NYSE:JWN)?
At year’s end, a total of 26 of the hedge funds we track were long in this stock, a change of -13% from the previous quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of key hedge fund managers who were boosting their stakes meaningfully.
When looking at the hedgies we track, Maverick Capital, managed by Lee Ainslie, holds the biggest position in Nordstrom, Inc. (NYSE:JWN). Maverick Capital has a $69 million billion position in the stock, comprising 1% of its 13F portfolio. Coming in second is Ken Griffin of Citadel Investment Group, with a $51 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining hedge funds that are bullish include John W. Rogers’s Ariel Investments, John Overdeck and David Siegel’s Two Sigma Advisors and Steven Cohen’s SAC Capital Advisors.
Because Nordstrom, Inc. (NYSE:JWN) has experienced declining sentiment from the smart money, it’s easy to see that there exists a select few money managers who sold off their positions entirely at the end of the year. It’s worth mentioning that SAC Subsidiary’s Sigma Capital Management said goodbye to the largest stake of all the hedgies we track, totaling an estimated $46 million in stock.. Ken Heebner’s fund, Capital Growth Management, also cut its stock, about $28 million worth. These transactions are intriguing to say the least, as aggregate hedge fund interest was cut by 4 funds at the end of the year.
What have insiders been doing with Nordstrom, Inc. (NYSE:JWN)?
Insider trading activity, especially when it’s bullish, is at its handiest when the company in question has experienced transactions within the past half-year. Over the last 180-day time frame, Nordstrom, Inc. (NYSE:JWN) has seen zero unique insiders buying, and 6 insider sales (see the details of insider trades here).
With the returns exhibited by the aforementioned studies, retail investors must always keep an eye on hedge fund and insider trading activity, and Nordstrom, Inc. (NYSE:JWN) applies perfectly to this mantra.
Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.