Rollins, Inc. (NYSE:ROL) shareholders have witnessed an increase in hedge fund sentiment in recent months.
In the eyes of most stock holders, hedge funds are viewed as unimportant, old financial vehicles of the past. While there are more than 8000 funds trading at present, we at Insider Monkey look at the masters of this group, close to 450 funds. Most estimates calculate that this group controls most of all hedge funds’ total asset base, and by monitoring their top picks, we have formulated a few investment strategies that have historically beaten the S&P 500 index. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per year 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 outperformed the S&P 500 index by 24 percentage points in 7 months (see all of our picks from August).
Equally as key, bullish insider trading activity is a second way to parse down the world of equities. There are lots of motivations for a bullish insider to sell shares of his or her company, but only one, very simple reason why they would initiate a purchase. Several academic studies have demonstrated the impressive potential of this strategy if shareholders understand where to look (learn more here).
With all of this in mind, we’re going to take a gander at the recent action surrounding Rollins, Inc. (NYSE:ROL).
Hedge fund activity in Rollins, Inc. (NYSE:ROL)
At the end of the fourth quarter, a total of 12 of the hedge funds we track were long in this stock, a change of 33% from one quarter earlier. With the smart money’s sentiment swirling, there exists a few notable hedge fund managers who were increasing their stakes substantially.
When looking at the hedgies we track, Mario Gabelli’s GAMCO Investors had the largest position in Rollins, Inc. (NYSE:ROL), worth close to $77.1 million, accounting for 0.6% of its total 13F portfolio. On GAMCO Investors’s heels is Royce & Associates, managed by Chuck Royce, which held a $18.4 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining hedge funds that are bullish include Jim Simons’s Renaissance Technologies, Israel Englander’s Millennium Management and Ken Griffin’s Citadel Investment Group.
With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Highbridge Capital Management, managed by Glenn Russell Dubin, created the most outsized position in Rollins, Inc. (NYSE:ROL). Highbridge Capital Management had 1.1 million invested in the company at the end of the quarter. David Costen Haley’s HBK Investments also made a $0.6 million investment in the stock during the quarter. The following funds were also among the new ROL investors: Joel Greenblatt’s Gotham Asset Management and Jacob Gottlieb’s Visium Asset Management.
Insider trading activity in Rollins, Inc. (NYSE:ROL)
Insider trading activity, especially when it’s bullish, is most useful when the company we’re looking at has experienced transactions within the past six months. Over the latest six-month time period, Rollins, Inc. (NYSE:ROL) has seen zero unique insiders buying, and 2 insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to Rollins, Inc. (NYSE:ROL). These stocks are Vantiv Inc (NYSE:VNTV), MAXIMUS, Inc. (NYSE:MMS), WEX Inc (NYSE:WXS), Global Payments Inc (NYSE:GPN), and athenahealth, Inc (NASDAQ:ATHN). This group of stocks are in the business services industry and their market caps are closest to ROL’s market cap.