Is Signet Jewelers Ltd. (NYSE:SIG) a buy?
In the eyes of many traders, hedge funds are perceived as delayed, old investment tools of a period lost to current times. Although there are In excess of 8,000 hedge funds in operation today, Insider Monkey focuses on the bigwigs of this club, around 525 funds. It is assumed that this group controls the majority of the smart money’s total capital, and by keeping an eye on their best equity investments, we’ve brought to light a few investment strategies that have historically outstripped the S&P 500. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per year 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 topped the S&P 500 index by 33 percentage points in 11 months (explore the details and some picks here).
Just as crucial, optimistic insider trading activity is another way to analyze the investments you’re interested in. As the old adage goes: there are a variety of reasons for an insider to get rid of shares of his or her company, but just one, very obvious reason why they would behave bullishly. Plenty of academic studies have demonstrated the market-beating potential of this method if piggybackers know what to do (learn more here).
Now that that’s out of the way, let’s discuss the latest info surrounding Signet Jewelers Ltd. (NYSE:SIG).
How have hedgies been trading Signet Jewelers Ltd. (NYSE:SIG)?
At the end of the second quarter, a total of 25 of the hedge funds we track were bullish in this stock, a change of 4% from the first quarter. With hedge funds’ capital changing hands, there exists a select group of noteworthy hedge fund managers who were upping their holdings significantly.
As aggregate interest spiked, certain money managers have been driving this bullishness. Odey Asset Management Group, managed by Crispin Odey, initiated the most outsized position in Signet Jewelers Ltd. (NYSE:SIG). Odey Asset Management Group had 218.1 million invested in the company at the end of the quarter. Robert Joseph Caruso’s Select Equity Group also initiated a $201.3 million position during the quarter. The other funds with new positions in the stock are John Armitage’s Egerton Capital Limited, Robert Rodriguez and Steven Romick’s First Pacific Advisors LLC, and David Gallo’s Valinor Management LLC.
What do corporate executives and insiders think about Signet Jewelers Ltd. (NYSE:SIG)?
Insider buying made by high-level executives is particularly usable when the company in question has seen transactions within the past six months. Over the latest 180-day time frame, Signet Jewelers Ltd. (NYSE:SIG) has experienced zero unique insiders buying, and 12 insider sales (see the details of insider trades here).
We’ll go over the relationship between both of these indicators in other stocks similar to Signet Jewelers Ltd. (NYSE:SIG). These stocks are Charles & Colvard, Ltd. (NASDAQ:CTHR), Zale Corporation (NYSE:ZLC), Blue Nile Inc (NASDAQ:NILE), Luxottica Group SpA (ADR) (NYSE:LUX), and Tiffany & Co. (NYSE:TIF). This group of stocks are in the jewelry stores industry and their market caps are closest to SIG’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Charles & Colvard, Ltd. (NASDAQ:CTHR) | 2 | 2 | 1 |
| Zale Corporation (NYSE:ZLC) | 12 | 0 | 1 |
| Blue Nile Inc (NASDAQ:NILE) | 9 | 0 | 2 |
| Luxottica Group SpA (ADR) (NYSE:LUX) | 5 | 0 | 0 |
| Tiffany & Co. (NYSE:TIF) | 29 | 2 | 12 |
Using the results shown by Insider Monkey’s strategies, average investors should always keep one eye on hedge fund and insider trading sentiment, and Signet Jewelers Ltd. (NYSE:SIG) is an important part of this process.
