Is Ameristar Casinos, Inc. (NASDAQ:ASCA) the right pick for your portfolio? The smart money is selling. The number of bullish hedge fund positions fell by 2 lately.
To most shareholders, hedge funds are viewed as slow, old investment vehicles of years past. While there are greater than 8000 funds with their doors open at the moment, we at Insider Monkey hone in on the upper echelon of this group, about 450 funds. It is widely believed that this group oversees the lion’s share of the hedge fund industry’s total capital, and by monitoring their best picks, we have discovered a few investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points a 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 beaten the S&P 500 index by 23.3 percentage points in 8 months (see all of our picks from August).
Equally as beneficial, positive insider trading sentiment is another way to break down the financial markets. There are lots of incentives for a corporate insider to sell shares of his or her company, but only one, very simple reason why they would behave bullishly. Various academic studies have demonstrated the market-beating potential of this tactic if “monkeys” understand where to look (learn more here).
With these “truths” under our belt, it’s important to take a gander at the key action surrounding Ameristar Casinos, Inc. (NASDAQ:ASCA).
How have hedgies been trading Ameristar Casinos, Inc. (NASDAQ:ASCA)?
In preparation for this quarter, a total of 26 of the hedge funds we track were bullish in this stock, a change of -7% from the first quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were boosting their stakes significantly.
Of the funds we track, PAR Capital Management, managed by Paul Reeder and Edward Shapiro, holds the most valuable position in Ameristar Casinos, Inc. (NASDAQ:ASCA). PAR Capital Management has a $54.8 million position in the stock, comprising 1.7% of its 13F portfolio. Coming in second is AQR Capital Management, managed by Cliff Asness, which held a $36.9 million position; 0.1% of its 13F portfolio is allocated to the company. Remaining peers that are bullish include Robert Emil Zoellner’s Alpine Associates, Tom Sandell’s Sandell Asset Management and Jim Simons’s Renaissance Technologies.
Due to the fact that Ameristar Casinos, Inc. (NASDAQ:ASCA) has witnessed falling interest from hedge fund managers, it’s safe to say that there were a few money managers that slashed their entire stakes heading into Q2. Interestingly, Dmitry Balyasny’s Balyasny Asset Management cut the biggest stake of the 450+ funds we track, comprising about $42.4 million in stock.. Clint Carlson’s fund, Carlson Capital, also dumped its stock, about $11.9 million worth. These moves are important to note, as total hedge fund interest fell by 2 funds heading into Q2.
What have insiders been doing with Ameristar Casinos, Inc. (NASDAQ:ASCA)?
Insider purchases made by high-level executives is best served when the company we’re looking at has experienced transactions within the past half-year. Over the last six-month time frame, Ameristar Casinos, Inc. (NASDAQ:ASCA) has experienced zero unique insiders buying, and 1 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Ameristar Casinos, Inc. (NASDAQ:ASCA). These stocks are The Marcus Corporation (NYSE:MCS), Caesars Entertainment Corp (NASDAQ:CZR), Marriott Vacations Worldwide Corp (NYSE:VAC), Boyd Gaming Corporation (NYSE:BYD), and Pinnacle Entertainment, Inc (NYSE:PNK). This group of stocks belong to the resorts & casinos industry and their market caps are similar to ASCA’s market cap.