Is Kemper Corporation (NYSE:KMPR) a healthy stock for your portfolio? Hedge funds are becoming less confident. The number of bullish hedge fund positions stayed the same which is a slightly negative development in our experience
To the average investor, there are many gauges investors can use to monitor the equity markets. Two of the most under-the-radar are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the elite hedge fund managers can outclass the broader indices by a healthy amount (see just how much).
Just as key, positive insider trading activity is a second way to parse down the stock market universe. Obviously, there are a variety of stimuli for an insider to downsize shares of his or her company, but just one, very simple reason why they would initiate a purchase. Many empirical studies have demonstrated the useful potential of this strategy if “monkeys” understand where to look (learn more here).
Now, it’s important to take a peek at the latest action encompassing Kemper Corporation (NYSE:KMPR).
What have hedge funds been doing with Kemper Corporation (NYSE:KMPR)?
At the end of the fourth quarter, a total of 5 of the hedge funds we track were bullish in this stock, a change of 0% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were increasing their stakes significantly.
When looking at the hedgies we track, Royce & Associates, managed by Chuck Royce, holds the biggest position in Kemper Corporation (NYSE:KMPR). Royce & Associates has a $12.9 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Coming in second is Michael Price of MFP Investors, with a $1.8 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Some other peers that hold long positions include Ken Griffin’s Citadel Investment Group, Israel Englander’s Millennium Management and Cliff Asness’s AQR Capital Management.
Because Kemper Corporation (NYSE:KMPR) has witnessed bearish sentiment from hedge fund managers, we can see that there were a few hedgies that elected to cut their full holdings last quarter. Intriguingly, John Burbank’s Passport Capital cut the biggest investment of the “upper crust” of funds we watch, comprising about $0.3 million in stock. These bearish behaviors are intriguing to say the least, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
How are insiders trading Kemper Corporation (NYSE:KMPR)?
Insider purchases made by high-level executives is at its handiest when the company we’re looking at has experienced transactions within the past half-year. Over the last six-month time frame, Kemper Corporation (NYSE:KMPR) has experienced zero unique insiders buying, and 2 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 Kemper Corporation (NYSE:KMPR). These stocks are Enstar Group Ltd. (NASDAQ:ESGR), Endurance Specialty Holdings Ltd. (NYSE:ENH), Radian Group Inc (NYSE:RDN), Platinum Underwriters Holdings, Ltd. (NYSE:PTP), and MBIA Inc. (NYSE:MBI). All of these stocks are in the property & casualty insurance industry and their market caps are similar to KMPR’s market cap.