Is it smart to be bullish on Kilroy Realty Corp (NYSE:KRC)?
If you were to ask many investors, hedge funds are viewed as useless, old investment tools of a period lost to current times. Although there are over 8,000 hedge funds in operation today, this site aim at the aristocrats of this group, close to 525 funds. It is widely held that this group oversees the majority of the hedge fund industry’s total assets, and by paying attention to their highest performing investments, we’ve figured out a few investment strategies that have historically outpaced the broader indices. 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 33 percentage points in 11 months (find a sample of our picks).
Equally as crucial, bullish insider trading sentiment is a second way to look at the world of equities. As the old adage goes: there are many incentives for an executive to downsize shares of his or her company, but only one, very obvious reason why they would initiate a purchase. Many empirical studies have demonstrated the valuable potential of this method if shareholders know where to look (learn more here).
Now that that’s out of the way, it’s important to examine the latest info for Kilroy Realty Corp (NYSE:KRC).
How have hedgies been trading Kilroy Realty Corp (NYSE:KRC)?
At Q2’s end, a total of 9 of the hedge funds we track were long in this stock, a change of 0% from the first quarter. With hedgies’ capital changing hands, there exists a select group of notable hedge fund managers who were upping their holdings meaningfully.
According to our 13F database, Jeffrey Furber’s AEW Capital Management had the largest position in Kilroy Realty Corp (NYSE:KRC), worth close to $111.8 million, accounting for 2.9% of its total 13F portfolio. The second largest stake is held by Ken Griffin of Citadel Investment Group, with a $52.1 million position; 0.1% of its 13F portfolio is allocated to the company. Remaining peers that are bullish include Dmitry Balyasny’s Balyasny Asset Management, Clint Carlson’s Carlson Capital and Millennium Management Subsidiary’s Decade Capital Management.
Due to the fact Kilroy Realty Corp (NYSE:KRC) has experienced bearish sentiment from the top-tier hedge fund industry, logic holds that there were a few hedgies that decided to sell off their positions entirely at the end of the second quarter. It’s worth mentioning that D. E. Shaw’s D E Shaw dumped the largest position of all the hedgies we key on, worth close to $1.2 million in stock, and Robert B. Gillam of McKinley Capital Management was right behind this move, as the fund dumped about $0.3 million worth. These bearish behaviors are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
What have insiders been doing with Kilroy Realty Corp (NYSE:KRC)?
Insider buying is best served when the primary stock in question has experienced transactions within the past half-year. Over the last half-year time frame, Kilroy Realty Corp (NYSE:KRC) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We’ll check out the relationship between both of these indicators in other stocks similar to Kilroy Realty Corp (NYSE:KRC). These stocks are CommonWealth REIT (NYSE:CWH), Highwoods Properties Inc (NYSE:HIW), Liberty Property Trust (NYSE:LRY), Piedmont Office Realty Trust, Inc. (NYSE:PDM), and Alexandria Real Estate Equities Inc (NYSE:ARE). This group of stocks belong to the reit – office industry and their market caps match KRC’s market cap.