Is Xcel Energy Inc (XEL) Going to Burn These Hedge Funds?

Xcel Energy Inc (NYSE:XEL) shareholders have witnessed a decrease in hedge fund interest of late.

In the financial world, there are a multitude of gauges investors can use to analyze stocks. A couple of the most innovative are hedge fund and insider trading movement. 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 healthy amount (see just how much).

Equally as integral, positive insider trading sentiment is another way to break down the investments you’re interested in. Obviously, there are plenty of incentives for a corporate insider to drop shares of his or her company, but only one, very simple reason why they would initiate a purchase. Several academic studies have demonstrated the market-beating potential of this strategy if piggybackers know where to look (learn more here).

Keeping this in mind, let’s take a look at the key action regarding Xcel Energy Inc (NYSE:XEL).

What have hedge funds been doing with Xcel Energy Inc (NYSE:XEL)?

In preparation for this quarter, a total of 13 of the hedge funds we track held long positions in this stock, a change of -7% from one quarter earlier.

Seeing as Xcel Energy Inc (NYSE:XEL) has witnessed bearish sentiment from hedge fund managers, logic holds that there was a specific group of hedge funds that decided to sell off their entire stakes heading into Q2. Interestingly, Phill Gross and Robert Atchinson’s Adage Capital Management dumped the largest position of the “upper crust” of funds we watch, valued at close to $18.5 million in stock., and Matthew Tewksbury of Stevens Capital Management was right behind this move, as the fund dumped about $4 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest was cut by 1 funds heading into Q2.

How have insiders been trading Xcel Energy Inc (NYSE:XEL)?

Bullish insider trading is best served when the company in question has experienced transactions within the past 180 days. Over the latest six-month time frame, Xcel Energy Inc (NYSE:XEL) has experienced 3 unique insiders buying, and zero insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Xcel Energy Inc (NYSE:XEL). These stocks are FirstEnergy Corp. (NYSE:FE), Korea Electric Power Corporation (ADR) (NYSE:KEP), Edison International (NYSE:EIX), Huaneng Power International Inc (ADR) (NYSE:HNP), and Empresa Nacional de Electricidad (ADR) (NYSE:EOC). All of these stocks are in the electric utilities industry and their market caps are similar to XEL’s market cap.