Is Medical Properties Trust, Inc. (NYSE:MPW) worth your attention right now? Hedge funds are becoming less hopeful. The number of bullish hedge fund bets decreased by 1 in recent months.
If you’d ask most investors, hedge funds are assumed to be unimportant, old investment tools of yesteryear. While there are over 8000 funds with their doors open at the moment, we look at the moguls of this group, around 450 funds. It is estimated that this group oversees the lion’s share of the smart money’s total asset base, and by paying attention to their best investments, we have discovered a few investment strategies that have historically outstripped the market. 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 began to sharing our picks with our subscribers at the end of August 2012, we have beaten the S&P 500 index by 24 percentage points in 7 months (see the details here).
Just as important, positive insider trading sentiment is another way to parse down the investments you’re interested in. There are many motivations for a bullish insider to drop shares of his or her company, but only one, very simple reason why they would buy. Various empirical studies have demonstrated the impressive potential of this strategy if “monkeys” understand where to look (learn more here).
Consequently, we’re going to take a peek at the recent action surrounding Medical Properties Trust, Inc. (NYSE:MPW).
How have hedgies been trading Medical Properties Trust, Inc. (NYSE:MPW)?
Heading into 2013, a total of 9 of the hedge funds we track were bullish in this stock, a change of -10% from the third quarter. With the smart money’s sentiment swirling, there exists an “upper tier” of key hedge fund managers who were boosting their holdings considerably.
When looking at the hedgies we track, Cardinal Capital, managed by Amy Minella, holds the most valuable position in Medical Properties Trust, Inc. (NYSE:MPW). Cardinal Capital has a $36.5 million position in the stock, comprising 2.5% of its 13F portfolio. Sitting at the No. 2 spot is J. Alan Reid, Jr. of Forward Management, with a $19.7 million position; the fund has 1.4% of its 13F portfolio invested in the stock. Other hedgies that are bullish include Richard Driehaus’s Driehaus Capital, Brian Ashford-Russell and Tim Woolley’s Polar Capital and Cliff Asness’s AQR Capital Management.
Due to the fact that Medical Properties Trust, Inc. (NYSE:MPW) has faced a declination in interest from the entirety of the hedge funds we track, we can see that there is a sect of hedge funds who were dropping their positions entirely at the end of the year. At the top of the heap, Sean Cullinan’s Point State Capital sold off the largest stake of all the hedgies we key on, comprising an estimated $9.9 million in stock., and Peter Algert and Kevin Coldiron of Algert Coldiron Investors was right behind this move, as the fund dropped about $2.7 million worth. These moves are interesting, as aggregate hedge fund interest dropped by 1 funds at the end of the year.
How are insiders trading Medical Properties Trust, Inc. (NYSE:MPW)?
Insider buying is most useful when the company in question has experienced transactions within the past 180 days. Over the last six-month time period, Medical Properties Trust, Inc. (NYSE:MPW) has seen zero unique insiders buying, and 5 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Medical Properties Trust, Inc. (NYSE:MPW). These stocks are LTC Properties Inc (NYSE:LTC), Omega Healthcare Investors Inc (NYSE:OHI), National Health Investors Inc (NYSE:NHI), Healthcare Trust Of America Inc (NYSE:HTA), and Healthcare Realty Trust Inc (NYSE:HR). This group of stocks are in the reit – healthcare facilities industry and their market caps resemble MPW’s market cap.