Service Corporation International (NYSE:SCI) has seen an increase in activity from the world’s largest hedge funds in recent months.
In today’s marketplace, there are a multitude of methods investors can use to track Mr. Market. Two of the most under-the-radar are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best money managers can outpace the broader indices by a superb margin (see just how much).
Equally as important, optimistic insider trading activity is another way to parse down the financial markets. There are plenty of reasons for an upper level exec to get rid of shares of his or her company, but just one, very simple reason why they would behave bullishly. Plenty of empirical studies have demonstrated the useful potential of this method if you understand where to look (learn more here).
With these “truths” under our belt, it’s important to take a gander at the key action encompassing Service Corporation International (NYSE:SCI).
How have hedgies been trading Service Corporation International (NYSE:SCI)?
At the end of the first quarter, a total of 20 of the hedge funds we track were long in this stock, a change of 5% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings considerably.
According to our comprehensive database, Southeastern Asset Management, managed by Mason Hawkins, holds the most valuable position in Service Corporation International (NYSE:SCI). Southeastern Asset Management has a $241.3 million position in the stock, comprising 1.1% of its 13F portfolio. On Southeastern Asset Management’s heels is David Cohen and Harold Levy of Iridian Asset Management, with a $89.2 million position; the fund has 1.3% of its 13F portfolio invested in the stock. Other peers with similar optimism include D. E. Shaw’s D E Shaw, Cliff Asness’s AQR Capital Management and Jim Simons’s Renaissance Technologies.
Now, key money managers have been driving this bullishness. Clough Capital Partners, managed by Charles Clough, initiated the largest position in Service Corporation International (NYSE:SCI). Clough Capital Partners had 7.6 million invested in the company at the end of the quarter. Dmitry Balyasny’s Balyasny Asset Management also initiated a $0.4 million position during the quarter. The only other fund with a new position in the stock is Paul Tudor Jones’s Tudor Investment Corp.
How are insiders trading Service Corporation International (NYSE:SCI)?
Insider trading activity, especially when it’s bullish, is at its handiest when the company we’re looking at has experienced transactions within the past 180 days. Over the last half-year time frame, Service Corporation International (NYSE:SCI) has experienced 1 unique insiders purchasing, and 1 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 Service Corporation International (NYSE:SCI). These stocks are H&R Block, Inc. (NYSE:HRB), VCA Antech Inc (NASDAQ:WOOF), Bright Horizons Family Solutions Inc (NYSE:BFAM), Weight Watchers International, Inc. (NYSE:WTW), and Ulta Salon, Cosmetics & Fragrance, Inc. (NASDAQ:ULTA). This group of stocks are the members of the personal services industry and their market caps match SCI’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|H&R Block, Inc. (NYSE:HRB)||34||0||0|
|VCA Antech Inc (NASDAQ:WOOF)||23||0||3|
|Bright Horizons Family Solutions Inc (NYSE:BFAM)||15||4||0|
|Weight Watchers International, Inc. (NYSE:WTW)||9||0||2|
|Ulta Salon, Cosmetics & Fragrance, Inc. (NASDAQ:ULTA)||41||1||1|
With the returns shown by the aforementioned strategies, retail investors must always pay attention to hedge fund and insider trading activity, and Service Corporation International (NYSE:SCI) is an important part of this process.