Is TriMas Corp (NASDAQ:TRS) a cheap investment today? The best stock pickers are turning less bullish. The number of long hedge fund positions were cut by 1 lately.
In the eyes of most stock holders, hedge funds are perceived as underperforming, old investment tools of yesteryear. While there are greater than 8000 funds in operation at present, we at Insider Monkey hone in on the top tier of this group, around 450 funds. It is widely believed that this group controls the majority of the hedge fund industry’s total capital, and by watching their best investments, we have come up with a few investment strategies that have historically beaten Mr. Market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points per annum 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 outperformed the S&P 500 index by 24 percentage points in 7 months (see the details here).
Equally as important, optimistic insider trading sentiment is a second way to break down the stock market universe. Just as you’d expect, there are many reasons for an insider to cut shares of his or her company, but only one, very obvious reason why they would initiate a purchase. Many academic studies have demonstrated the market-beating potential of this strategy if investors understand what to do (learn more here).
Keeping this in mind, let’s take a gander at the key action encompassing TriMas Corp (NASDAQ:TRS).
What does the smart money think about TriMas Corp (NASDAQ:TRS)?
At the end of the fourth quarter, a total of 6 of the hedge funds we track held long positions in this stock, a change of -14% from the previous quarter. With the smart money’s sentiment swirling, there exists a select group of key hedge fund managers who were boosting their holdings significantly.
Of the funds we track, Visium Asset Management, managed by Jacob Gottlieb, holds the most valuable position in TriMas Corp (NASDAQ:TRS). Visium Asset Management has a $2.1 million position in the stock, comprising 0.1% of its 13F portfolio. Sitting at the No. 2 spot is Jim Simons of Renaissance Technologies, with a $1.7 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Other hedgies with similar optimism include D. E. Shaw’s D E Shaw, Phil Frohlich’s Prescott Group Capital Management and Ken Griffin’s Citadel Investment Group.
Due to the fact that TriMas Corp (NASDAQ:TRS) has witnessed declining sentiment from the entirety of the hedge funds we track, we can see that there lies a certain “tier” of money managers that slashed their entire stakes in Q4. Interestingly, Israel Englander’s Millennium Management said goodbye to the largest stake of all the hedgies we watch, worth an estimated $0.4 million in stock., and Mike Vranos of Ellington was right behind this move, as the fund cut about $0.2 million worth. These transactions are intriguing to say the least, as total hedge fund interest was cut by 1 funds in Q4.
What have insiders been doing with TriMas Corp (NASDAQ:TRS)?
Insider trading activity, especially when it’s bullish, is at its handiest when the company in focus has experienced transactions within the past six months. Over the latest half-year time period, TriMas Corp (NASDAQ:TRS) has experienced zero unique insiders buying, and 7 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to TriMas Corp (NASDAQ:TRS). These stocks are Sun Hydraulics Corporation (NASDAQ:SNHY), Mueller Water Products, Inc. (NYSE:MWA), Watts Water Technologies Inc (NYSE:WTS), Barnes Group Inc. (NYSE:B), and EnPro Industries, Inc. (NYSE:NPO). All of these stocks are in the industrial equipment & components industry and their market caps are closest to TRS’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Sun Hydraulics Corporation (NASDAQ:SNHY) | 4 | 0 | 2 |
| Mueller Water Products, Inc. (NYSE:MWA) | 26 | 1 | 1 |
| Watts Water Technologies Inc (NYSE:WTS) | 15 | 0 | 4 |
| Barnes Group Inc. (NYSE:B) | 13 | 1 | 7 |
| EnPro Industries, Inc. (NYSE:NPO) | 7 | 3 | 2 |
With the returns shown by our time-tested strategies, retail investors should always watch hedge fund and insider trading sentiment, and TriMas Corp (NASDAQ:TRS) is an important part of this process.
