Is Nucor Corporation (NYSE:NUE) a sell?
In the 21st century investor’s toolkit, there are tons of metrics market participants can use to track stocks. A duo of the best are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite investment managers can outpace the S&P 500 by a healthy amount (see just how much).
Equally as key, optimistic insider trading sentiment is a second way to analyze the world of equities. Just as you’d expect, there are a variety of reasons for an insider to cut shares of his or her company, but only one, very simple reason why they would behave bullishly. Various empirical studies have demonstrated the market-beating potential of this method if shareholders know where to look (learn more here).
Keeping this in mind, we’re going to analyze the latest info surrounding Nucor Corporation (NYSE:NUE).
What does the smart money think about Nucor Corporation (NYSE:NUE)?
In preparation for the third quarter, a total of 23 of the hedge funds we track held long positions in this stock, a change of -12% from the previous quarter. With the smart money’s capital changing hands, there exists an “upper tier” of key hedge fund managers who were increasing their stakes substantially.
Out of the hedge funds we follow, D E Shaw, managed by D. E. Shaw, holds the biggest position in Nucor Corporation (NYSE:NUE). D E Shaw has a $34.7 million position in the stock, comprising 0.1% of its 13F portfolio. Coming in second is Daniel S. Och of OZ Management, with a $25 million call position; 0.1% of its 13F portfolio is allocated to the company. Some other hedge funds with similar optimism include Phill Gross and Robert Atchinson’s Adage Capital Management, Israel Englander’s Millennium Management and John A. Levin’s Levin Capital Strategies.
Since Nucor Corporation (NYSE:NUE) has witnessed bearish sentiment from the entirety of the hedge funds we track, we can see that there lies a certain “tier” of money managers that decided to sell off their positions entirely heading into Q2. Interestingly, Clint Carlson’s Carlson Capital sold off the largest position of the 450+ funds we monitor, valued at close to $20.2 million in stock, and Paul Tudor Jones of Tudor Investment Corp was right behind this move, as the fund said goodbye to about $1.8 million worth. These moves are important to note, as aggregate hedge fund interest dropped by 3 funds heading into Q2.
What have insiders been doing with Nucor Corporation (NYSE:NUE)?
Bullish insider trading is particularly usable when the company in question has seen transactions within the past 180 days. Over the last six-month time period, Nucor Corporation (NYSE:NUE) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We’ll go over the relationship between both of these indicators in other stocks similar to Nucor Corporation (NYSE:NUE). These stocks are Companhia Siderurgica Nacional (ADR) (NYSE:SID), POSCO (ADR) (NYSE:PKX), Tenaris S.A. (ADR) (NYSE:TS), ArcelorMittal (ADR) (NYSE:MT), and Gerdau SA (ADR) (NYSE:GGB). All of these stocks are in the steel & iron industry and their market caps are similar to NUE’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Companhia Siderurgica Nacional (ADR) (NYSE:SID) | 8 | 0 | 0 |
| POSCO (ADR) (NYSE:PKX) | 9 | 0 | 0 |
| Tenaris S.A. (ADR) (NYSE:TS) | 10 | 0 | 0 |
| ArcelorMittal (ADR) (NYSE:MT) | 16 | 0 | 0 |
| Gerdau SA (ADR) (NYSE:GGB) | 9 | 0 | 0 |
Using the results explained by the previously mentioned research, regular investors must always keep one eye on hedge fund and insider trading activity, and Nucor Corporation (NYSE:NUE) is an important part of this process.
