Is Westport Innovations Inc. (USA) (NASDAQ:WPRT) worth your attention right now? The best stock pickers are reducing their bets on the stock. The number of long hedge fund positions decreased by 4 lately.
In the eyes of most stock holders, hedge funds are perceived as underperforming, old financial tools of yesteryear. While there are greater than 8000 funds in operation at the moment, we choose to focus on the leaders of this club, about 450 funds. Most estimates calculate that this group controls the majority of the hedge fund industry’s total asset base, and by watching their top investments, we have spotted a few investment strategies that have historically outperformed Mr. Market. Our small-cap hedge fund strategy beat 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 topped the S&P 500 index by 23.3 percentage points in 8 months (explore the details and some picks here).
Just as integral, bullish insider trading activity is another way to break down the marketplace. Obviously, there are a number of stimuli for a corporate insider to downsize shares of his or her company, but just one, very simple reason why they would buy. Many empirical studies have demonstrated the impressive potential of this method if “monkeys” understand what to do (learn more here).
Now, it’s important to take a look at the key action regarding Westport Innovations Inc. (USA) (NASDAQ:WPRT).
What have hedge funds been doing with Westport Innovations Inc. (USA) (NASDAQ:WPRT)?
Heading into Q2, a total of 13 of the hedge funds we track were bullish in this stock, a change of -24% from one quarter earlier.
Judging by the fact that Westport Innovations Inc. (USA) (NASDAQ:WPRT) has witnessed declining sentiment from hedge fund managers, we can see that there lies a certain “tier” of hedge funds that elected to cut their entire stakes heading into Q2. At the top of the heap, Thomas Steyer’s Farallon Capital dumped the largest investment of all the hedgies we key on, comprising an estimated $13.1 million in stock.. John A. Levin’s fund, Levin Capital Strategies, also said goodbye to its stock, about $2.6 million worth. These transactions are important to note, as aggregate hedge fund interest fell by 4 funds heading into Q2.
What do corporate executives and insiders think about Westport Innovations Inc. (USA) (NASDAQ:WPRT)?
Insider trading activity, especially when it’s bullish, is at its handiest when the primary stock in question has experienced transactions within the past half-year. Over the last six-month time period, Westport Innovations Inc. (USA) (NASDAQ:WPRT) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Westport Innovations Inc. (USA) (NASDAQ:WPRT). These stocks are Dana Holding Corporation (NYSE:DAN), American Axle & Manufact. Holdings, Inc. (NYSE:AXL), Tenneco Inc (NYSE:TEN), Monro Muffler Brake Inc (NASDAQ:MNRO), and Dorman Products Inc. (NASDAQ:DORM). This group of stocks are the members of the auto parts industry and their market caps resemble WPRT’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Dana Holding Corporation (NYSE:DAN)||36||0||3|
|American Axle & Manufact. Holdings, Inc. (NYSE:AXL)||23||0||1|
|Tenneco Inc (NYSE:TEN)||24||1||11|
|Monro Muffler Brake Inc (NASDAQ:MNRO)||9||1||4|
|Dorman Products Inc. (NASDAQ:DORM)||4||0||8|
With the results shown by our studies, everyday investors should always pay attention to hedge fund and insider trading activity, and Westport Innovations Inc. (USA) (NASDAQ:WPRT) applies perfectly to this mantra.