Should Mine Safety Appliances (NYSE:MSA) investors track the following data?
To many market players, hedge funds are viewed as overrated, old investment vehicles of a forgotten age. Although there are more than 8,000 hedge funds trading today, Insider Monkey focuses on the bigwigs of this club, close to 525 funds. It is widely held that this group controls the majority of all hedge funds’ total capital, and by watching their best investments, we’ve spotted a few investment strategies that have historically outperformed the broader indices. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve began to 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 (see all of our picks from August).
Just as crucial, bullish insider trading activity is a second way to analyze the investments you’re interested in. Obviously, there are lots of stimuli for a corporate insider to get rid of shares of his or her company, but only one, very obvious reason why they would behave bullishly. Several empirical studies have demonstrated the market-beating potential of this method if you know what to do (learn more here).
Furthermore, let’s discuss the newest info for Mine Safety Appliances (NYSE:MSA).
How have hedgies been trading Mine Safety Appliances (NYSE:MSA)?
In preparation for the third quarter, a total of 15 of the hedge funds we track were bullish in this stock, a change of -12% from the first quarter. With hedge funds’ sentiment swirling, there exists a few key hedge fund managers who were upping their stakes meaningfully.
According to our 13F database, Chuck Royce’s Royce & Associates had the biggest position in Mine Safety Appliances (NYSE:MSA), worth close to $26.2 million, comprising 0.1% of its total 13F portfolio. Coming in second is Ken Grossman and Glen Schneider of SG Capital Management, with a $6.5 million position; 2.8% of its 13F portfolio is allocated to the stock. Other hedgies that hold long positions include Gregg J. Powers’s Private Capital Management, Joel Greenblatt’s Gotham Asset Management and Jim Simons’s Renaissance Technologies.
Since Mine Safety Appliances (NYSE:MSA) has faced bearish sentiment from the top-tier hedge fund industry, it’s safe to say that there was a specific group of fund managers who were dropping their positions entirely in Q1. At the top of the heap, John Overdeck and David Siegel’s Two Sigma Advisors dropped the largest stake of the 450+ funds we monitor, comprising close to $2.8 million in stock. D. E. Shaw’s fund, D E Shaw, also dropped its stock, about $1.4 million worth. These moves are important to note, as aggregate hedge fund interest dropped by 2 funds in Q1.
What do corporate executives and insiders think about Mine Safety Appliances (NYSE:MSA)?
Bullish insider trading is best served when the company in question has seen transactions within the past six months. Over the latest half-year time frame, Mine Safety Appliances (NYSE:MSA) has experienced 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 Mine Safety Appliances (NYSE:MSA). These stocks are Cyberonics, Inc. (NASDAQ:CYBX), Globus Medical Inc (NYSE:GMED), Techne Corporation (NASDAQ:TECH), Opko Health Inc. (NYSE:OPK), and STERIS Corp (NYSE:STE). This group of stocks are in the medical appliances & equipment industry and their market caps resemble MSA’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Cyberonics, Inc. (NASDAQ:CYBX)||23||0||0|
|Globus Medical Inc (NYSE:GMED)||14||0||0|
|Techne Corporation (NASDAQ:TECH)||14||0||0|
|Opko Health Inc. (NYSE:OPK)||8||0||0|
|STERIS Corp (NYSE:STE)||20||0||0|
Using the returns shown by the previously mentioned strategies, average investors should always keep one eye on hedge fund and insider trading sentiment, and Mine Safety Appliances (NYSE:MSA) applies perfectly to this mantra.