Is Stanley Black & Decker, Inc. (NYSE:SWK) a buy or a sell?
To many of your peers, hedge funds are perceived as delayed, outdated investment tools of a forgotten age. Although there are In excess of 8,000 hedge funds in operation today, this site focuses on the bigwigs of this club, about 525 funds. It is widely held that this group has its hands on the lion’s share of the smart money’s total capital, and by paying attention to their best picks, we’ve uncovered a few investment strategies that have historically outperformed the broader indices. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have outclassed the S&P 500 index by 33 percentage points in 11 months (find the details here).
Just as useful, optimistic insider trading activity is another way to look at the investments you’re interested in. There are many stimuli for an insider to cut shares of his or her company, but just one, very clear reason why they would behave bullishly. Several empirical studies have demonstrated the valuable potential of this strategy if “monkeys” understand where to look (learn more here).
What’s more, it’s important to study the recent info about Stanley Black & Decker, Inc. (NYSE:SWK).
What does the smart money think about Stanley Black & Decker, Inc. (NYSE:SWK)?
At the end of the second quarter, a total of 21 of the hedge funds we track held long positions in this stock, a change of -19% from the previous quarter. With hedgies’ capital changing hands, there exists a few notable hedge fund managers who were boosting their stakes substantially.
Out of the hedge funds we follow, Ariel Investments, managed by John W. Rogers, holds the largest position in Stanley Black & Decker, Inc. (NYSE:SWK). Ariel Investments has a $68.4 million position in the stock, comprising 1.1% of its 13F portfolio. On Ariel Investments’s heels is Martin D. Sass of MD Sass, with a $34.2 million position; the fund has 2.8% of its 13F portfolio invested in the stock. Remaining hedgies that hold long positions include Ken Griffin’s Citadel Investment Group, Phill Gross and Robert Atchinson’s Adage Capital Management and Israel Englander’s Millennium Management.
Judging by the fact that Stanley Black & Decker, Inc. (NYSE:SWK) has experienced declining interest from the smart money’s best and brightest, it’s easy to see that there is a sect of hedge funds that slashed their entire stakes last quarter. It’s worth mentioning that Daniel S. Och’s OZ Management said goodbye to the biggest position of the 450+ funds we monitor, valued at about $27.7 million in stock, and Frank Brosens of Taconic Capital was right behind this move, as the fund sold off about $14.2 million worth. These moves are interesting, as total hedge fund interest was cut by 5 funds last quarter.
What do corporate executives and insiders think about Stanley Black & Decker, Inc. (NYSE:SWK)?
Insider buying made by high-level executives is most useful when the primary stock in question has experienced transactions within the past 180 days. Over the last half-year time period, Stanley Black & Decker, Inc. (NYSE:SWK) has seen zero unique insiders purchasing, and 17 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 Stanley Black & Decker, Inc. (NYSE:SWK). These stocks are RBC Bearings Incorporated (NASDAQ:ROLL), Proto Labs Inc (NYSE:PRLB), Kennametal Inc. (NYSE:KMT), MRC Global Inc (NYSE:MRC), and The Timken Company (NYSE:TKR). This group of stocks belong to the machine tools & accessories industry and their market caps resemble SWK’s market cap.