Laclede Group Inc (LG): Insiders Aren’t Crazy About It

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Laclede Group Inc (NYSE:LG) was in 8 hedge funds’ portfolio at the end of the first quarter of 2013. LG has experienced an increase in support from the world’s most elite money managers in recent months. There were 6 hedge funds in our database with LG positions at the end of the previous quarter.

In the eyes of most investors, hedge funds are viewed as worthless, old financial vehicles of yesteryear. While there are greater than 8000 funds in operation today, we look at the bigwigs of this group, around 450 funds. Most estimates calculate that this group controls most of the smart money’s total asset base, and by keeping an eye on their highest performing stock picks, we have formulated a few investment strategies that have historically outperformed the broader indices. Our small-cap hedge fund strategy outstripped 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 beaten the S&P 500 index by 23.3 percentage points in 8 months (see all of our picks from August).

Laclede Group Inc (NYSE:LG)

Equally as important, bullish insider trading sentiment is a second way to break down the investments you’re interested in. Obviously, there are a variety of stimuli for an insider to sell shares of his or her company, but just one, very obvious reason why they would buy. Plenty of empirical studies have demonstrated the useful potential of this strategy if investors understand what to do (learn more here).

Now, let’s take a glance at the recent action regarding Laclede Group Inc (NYSE:LG).

Hedge fund activity in Laclede Group Inc (NYSE:LG)

Heading into Q2, a total of 8 of the hedge funds we track held long positions in this stock, a change of 33% from the first quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their holdings significantly.

Of the funds we track, Cliff Asness’s AQR Capital Management had the biggest position in Laclede Group Inc (NYSE:LG), worth close to $6.1 million, comprising less than 0.1%% of its total 13F portfolio. Coming in second is Jim Simons of Renaissance Technologies, with a $3.7 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Other peers that hold long positions include Ken Griffin’s Citadel Investment Group, Ken Gray and Steve Walsh’s Bryn Mawr Capital and Paul Tudor Jones’s Tudor Investment Corp.

As industrywide interest jumped, key hedge funds were leading the bulls’ herd. SAC Capital Advisors, managed by Steven Cohen, assembled the most outsized position in Laclede Group Inc (NYSE:LG). SAC Capital Advisors had 0.4 million invested in the company at the end of the quarter. Matthew Tewksbury’s Stevens Capital Management also initiated a $0.3 million position during the quarter.

What have insiders been doing with Laclede Group Inc (NYSE:LG)?

Bullish insider trading is at its handiest when the company we’re looking at has seen transactions within the past half-year. Over the latest six-month time period, Laclede Group Inc (NYSE:LG) has experienced zero unique insiders purchasing, and 2 insider sales (see the details of insider trades here).

Let’s also take a look at hedge fund and insider activity in other stocks similar to Laclede Group Inc (NYSE:LG). These stocks are Summit Midstream Partners LP (NYSE:SMLP), PAA Natural Gas Storage, L.P. (NYSE:PNG), Northwest Natural Gas Co (NYSE:NWN), Clean Energy Fuels Corp (NASDAQ:CLNE), and Niska Gas Storage Partners LLC (NYSE:NKA). All of these stocks are in the gas utilities industry and their market caps resemble LG’s market cap.

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