Is Wageworks Inc (WAGE) Going to Burn These Hedge Funds?

Wageworks Inc (NYSE:WAGE) was in 9 hedge funds’ portfolio at the end of the fourth quarter of 2012. WAGE has seen an increase in support from the world’s most elite money managers of late. There were 1 hedge funds in our database with WAGE positions at the end of the previous quarter.

At the moment, there are plenty of gauges shareholders can use to watch Mr. Market. A duo of the most under-the-radar 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 investment managers can outclass their index-focused peers by a very impressive margin (see just how much).

Wageworks Inc (NYSE:WAGE)

Just as key, optimistic insider trading sentiment is another way to parse down the world of equities. Obviously, there are plenty of incentives for an insider to sell shares of his or her company, but only one, very obvious reason why they would initiate a purchase. Many academic studies have demonstrated the useful potential of this tactic if investors know where to look (learn more here).

With all of this in mind, let’s take a gander at the key action encompassing Wageworks Inc (NYSE:WAGE).

What have hedge funds been doing with Wageworks Inc (NYSE:WAGE)?

At the end of the fourth quarter, a total of 9 of the hedge funds we track were long in this stock, a change of 800% from one quarter earlier. With hedgies’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were boosting their stakes substantially.

Of the funds we track, Royce & Associates, managed by Chuck Royce, holds the biggest position in Wageworks Inc (NYSE:WAGE). Royce & Associates has a $8.7 million position in the stock, comprising less than 0.1%% of its 13F portfolio. The second largest stake is held by Harvest Capital Strategies, managed by Joseph A. Jolson, which held a $4.9 million position; the fund has 0.9% of its 13F portfolio invested in the stock. Remaining hedge funds that hold long positions include Scott Burney’s Bluefin Investment Management, Anand Parekh’s Alyeska Investment Group and Richard S. Meisenberg’s ACK Asset Management.

As one would reasonably expect, key money managers have jumped into Wageworks Inc (NYSE:WAGE) headfirst. Harvest Capital Strategies, managed by Joseph A. Jolson, created the most outsized position in Wageworks Inc (NYSE:WAGE). Harvest Capital Strategies had 4.9 million invested in the company at the end of the quarter. Scott Burney’s Bluefin Investment Management also initiated a $3.6 million position during the quarter. The other funds with new positions in the stock are Anand Parekh’s Alyeska Investment Group, Richard S. Meisenberg’s ACK Asset Management, and SAC Subsidiary’s CR Intrinsic Investors.

Insider trading activity in Wageworks Inc (NYSE:WAGE)

Insider buying is most useful when the company in focus has experienced transactions within the past six months. Over the latest half-year time period, Wageworks Inc (NYSE:WAGE) has seen 1 unique insiders purchasing, and 8 insider sales (see the details of insider trades here).

Let’s check out hedge fund and insider activity in other stocks similar to Wageworks Inc (NYSE:WAGE). These stocks are ICF International Inc (NASDAQ:ICFI), Accretive Health, Inc. (NYSE:AH), Navigant Consulting, Inc. (NYSE:NCI), Huron Consulting Group (NASDAQ:HURN), and Exponent, Inc. (NASDAQ:EXPO). This group of stocks are the members of the management services industry and their market caps are closest to WAGE’s market cap.