Life Time Fitness, Inc. (LTM): Insiders Are Buying, Should You?

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Life Time Fitness, Inc. (NYSE:LTM) was in 12 hedge funds’ portfolio at the end of the first quarter of 2013. LTM has experienced an increase in activity from the world’s largest hedge funds lately. There were 7 hedge funds in our database with LTM holdings at the end of the previous quarter.

At the moment, there are many indicators investors can use to monitor Mr. Market. Some of the best are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best money managers can outclass the broader indices by a significant amount (see just how much).

Equally as key, positive insider trading activity is a second way to break down the financial markets. As the old adage goes: there are a number of reasons for an executive to drop shares of his or her company, but only one, very simple reason why they would behave bullishly. Various academic studies have demonstrated the valuable potential of this strategy if “monkeys” know what to do (learn more here).

Keeping this in mind, we’re going to take a gander at the latest action regarding Life Time Fitness, Inc. (NYSE:LTM).

What does the smart money think about Life Time Fitness, Inc. (NYSE:LTM)?

In preparation for this quarter, a total of 12 of the hedge funds we track held long positions in this stock, a change of 71% from the previous quarter. With the smart money’s capital changing hands, there exists a few noteworthy hedge fund managers who were upping their stakes considerably.

Life Time Fitness, Inc. (NYSE:LTM)According to our comprehensive database, Mariko Gordon’s Daruma Asset Management had the biggest position in Life Time Fitness, Inc. (NYSE:LTM), worth close to $43.8 million, comprising 2.2% of its total 13F portfolio. Sitting at the No. 2 spot is Highland Capital Management, managed by James Dondero, which held a $21.4 million position; the fund has 1.8% of its 13F portfolio invested in the stock. Some other hedge funds that are bullish include Wilmot B. Harkey and Daniel Mack’s Nantahala Capital Management, Ward Davis and Brian Agnew’s Caerus Global Investors and Ken Griffin’s Citadel Investment Group.

As aggregate interest increased, specific money managers have been driving this bullishness. Nantahala Capital Management, managed by Wilmot B. Harkey and Daniel Mack, initiated the most valuable position in Life Time Fitness, Inc. (NYSE:LTM). Nantahala Capital Management had 8.3 million invested in the company at the end of the quarter. D. E. Shaw’s D E Shaw also made a $1.3 million investment in the stock during the quarter. The following funds were also among the new LTM investors: John Overdeck and David Siegel’s Two Sigma Advisors, Israel Englander’s Millennium Management, and Matthew Tewksbury’s Stevens Capital Management.

Insider trading activity in Life Time Fitness, Inc. (NYSE:LTM)

Insider trading activity, especially when it’s bullish, is best served when the primary stock in question has seen transactions within the past 180 days. Over the latest 180-day time period, Life Time Fitness, Inc. (NYSE:LTM) has experienced 1 unique insiders purchasing, and 5 insider sales (see the details of insider trades here).

Let’s check out hedge fund and insider activity in other stocks similar to Life Time Fitness, Inc. (NYSE:LTM). These stocks are Dover Motorsports, Inc. (NYSE:DVD), Bowl America Incorporated (NYSEAMEX:BWL-A), Town Sports International Holdings, Inc. (NASDAQ:CLUB), Speedway Motorsports, Inc. (NYSE:TRK), and International Speedway Corporation (NASDAQ:ISCA). This group of stocks are the members of the sporting activities industry and their market caps are closest to LTM’s market cap.

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