Macerich Co (MAC): Hedge Funds Are Bearish and Insiders Are Bullish, What Should You Do? – SL Green Realty Corp (SLG), Kimco Realty Corp (KIM)

Macerich Co (NYSE:MAC) was in 9 hedge funds’ portfolio at the end of December. MAC investors should pay attention to a decrease in enthusiasm from smart money recently. There were 15 hedge funds in our database with MAC holdings at the end of the previous quarter.

Macerich Co (NYSE:MAC)

In the financial world, there are many methods market participants can use to monitor publicly traded companies. A pair of the most innovative are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best fund managers can outclass the broader indices by a superb amount (see just how much).

Just as integral, positive insider trading sentiment is another way to parse down the investments you’re interested in. As the old adage goes: there are many incentives for an insider to drop shares of his or her company, but only one, very clear reason why they would behave bullishly. Various academic studies have demonstrated the impressive potential of this method if piggybackers understand where to look (learn more here).

Now, it’s important to take a glance at the latest action encompassing Macerich Co (NYSE:MAC).

What does the smart money think about Macerich Co (NYSE:MAC)?

At the end of the fourth quarter, a total of 9 of the hedge funds we track held long positions in this stock, a change of -40% from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of key hedge fund managers who were boosting their holdings meaningfully.

Of the funds we track, AEW Capital Management, managed by Jeffrey Furber, holds the most valuable position in Macerich Co (NYSE:MAC). AEW Capital Management has a $122.9 million position in the stock, comprising 3.2% of its 13F portfolio. On AEW Capital Management’s heels is Carlson Capital, managed by Clint Carlson, which held a $44.2 million position; 0.7% of its 13F portfolio is allocated to the company. Some other hedge funds with similar optimism include Cliff Asness’s AQR Capital Management, Ken Griffin’s Citadel Investment Group and J. Alan Reid, Jr.’s Forward Management.

Seeing as Macerich Co (NYSE:MAC) has witnessed declining sentiment from the smart money, logic holds that there was a specific group of hedgies that slashed their entire stakes heading into 2013. At the top of the heap, Israel Englander’s Millennium Management said goodbye to the biggest position of the “upper crust” of funds we watch, worth about $15.6 million in stock.. Thomas Bailard’s fund, Bailard Inc, also cut its stock, about $1.5 million worth. These transactions are interesting, as aggregate hedge fund interest fell by 6 funds heading into 2013.

How are insiders trading Macerich Co (NYSE:MAC)?

Insider trading activity, especially when it’s bullish, is best served when the company in question has seen transactions within the past 180 days. Over the last 180-day time frame, Macerich Co (NYSE:MAC) has experienced 2 unique insiders purchasing, and 4 insider sales (see the details of insider trades here).

Let’s also examine hedge fund and insider activity in other stocks similar to Macerich Co (NYSE:MAC). These stocks are DDR Corp (NYSE:DDR), Federal Realty Investment Trust (NYSE:FRT), SL Green Realty Corp (NYSE:SLG), Kimco Realty Corp (NYSE:KIM), and Realty Income Corp (NYSE:O). This group of stocks are in the reit – retail industry and their market caps are closest to MAC’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
DDR Corp (NYSE:DDR) 9 0 7
Federal Realty Investment Trust (NYSE:FRT) 12 0 2
SL Green Realty Corp (NYSE:SLG) 13 0 6
Kimco Realty Corp (NYSE:KIM) 11 0 4
Realty Income Corp (NYSE:O) 6 0 6

With the returns demonstrated by our studies, everyday investors should always keep an eye on hedge fund and insider trading activity, and Macerich Co (NYSE:MAC) is no exception.

Click here to learn why you should track hedge funds