Is Regal Entertainment Group (NYSE:RGC) undervalued? Hedge funds are in a bearish mood. The number of long hedge fund bets decreased by 5 lately.
To the average investor, there are plenty of metrics market participants can use to track Mr. Market. Some of the most useful are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best investment managers can outpace their index-focused peers by a superb amount (see just how much).
Equally as important, positive insider trading sentiment is a second way to break down the investments you’re interested in. As the old adage goes: there are plenty of motivations for an upper level exec to get rid of shares of his or her company, but only one, very simple reason why they would buy. Various academic studies have demonstrated the market-beating potential of this strategy if you understand what to do (learn more here).
Now, let’s take a glance at the recent action regarding Regal Entertainment Group (NYSE:RGC).
How have hedgies been trading Regal Entertainment Group (NYSE:RGC)?
At year’s end, a total of 16 of the hedge funds we track were bullish in this stock, a change of -24% from the third quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of noteworthy hedge fund managers who were boosting their holdings substantially.
According to our comprehensive database, Peconic Partners LLC, managed by William Harnisch, holds the largest position in Regal Entertainment Group (NYSE:RGC). Peconic Partners LLC has a $42 million position in the stock, comprising 8.2% of its 13F portfolio. The second largest stake is held by Spencer M. Waxman of Shannon River Fund Management, with a $19 million position; 0.1% of its 13F portfolio is allocated to the company. Other peers that hold long positions include Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, John Fichthorn’s Dialectic Capital Management and Joshua Friedman and Mitchell Julis’s Canyon Capital Advisors.
Due to the fact that Regal Entertainment Group (NYSE:RGC) has experienced declining sentiment from hedge fund managers, it’s safe to say that there exists a select few fund managers that decided to sell off their positions entirely last quarter. Intriguingly, Dmitry Balyasny’s Balyasny Asset Management dropped the biggest investment of the 450+ funds we monitor, totaling about $20 million in stock., and Scott Burney of Bluefin Investment Management was right behind this move, as the fund sold off about $5 million worth. These transactions are interesting, as total hedge fund interest fell by 5 funds last quarter.
What have insiders been doing with Regal Entertainment Group (NYSE:RGC)?
Bullish insider trading is best served when the company we’re looking at has experienced transactions within the past six months. Over the last six-month time frame, Regal Entertainment Group (NYSE:RGC) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
With the results demonstrated by the aforementioned strategies, everyday investors must always watch hedge fund and insider trading sentiment, and Regal Entertainment Group (NYSE:RGC) applies perfectly to this mantra.
Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.