Walter Energy, Inc. (NYSE:WLT) has experienced a decrease in support from the world’s most elite money managers recently.
At the moment, there are a multitude of gauges market participants can use to monitor stocks. A pair of the most underrated are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top investment managers can trounce the S&P 500 by a superb amount (see just how much).
Equally as integral, bullish insider trading activity is another way to parse down the stock market universe. Obviously, there are a variety of incentives for a corporate insider to get rid of shares of his or her company, but just one, very clear reason why they would behave bullishly. Many empirical studies have demonstrated the valuable potential of this method if you know where to look (learn more here).
With these “truths” under our belt, let’s take a gander at the latest action encompassing Walter Energy, Inc. (NYSE:WLT).
What have hedge funds been doing with Walter Energy, Inc. (NYSE:WLT)?
In preparation for this quarter, a total of 26 of the hedge funds we track held long positions in this stock, a change of -16% from one quarter earlier. With the smart money’s capital changing hands, there exists a few key hedge fund managers who were upping their holdings considerably.
Because Walter Energy, Inc. (NYSE:WLT) has experienced a declination in interest from hedge fund managers, logic holds that there is a sect of funds who sold off their entire stakes heading into Q2. Interestingly, Jim Simons’s Renaissance Technologies cut the biggest stake of the “upper crust” of funds we watch, worth an estimated $51.6 million in stock. Bruce J. Richards and Louis Hanover’s fund, Marathon Asset Management, also dropped its stock, about $51.5 million worth. These transactions are important to note, as aggregate hedge fund interest fell by 5 funds heading into Q2.
What have insiders been doing with Walter Energy, Inc. (NYSE:WLT)?
Insider buying is best served when the company we’re looking at has seen transactions within the past six months. Over the latest half-year time period, Walter Energy, Inc. (NYSE:WLT) has experienced 11 unique insiders buying, and zero insider sales (see the details of insider trades here).
With the returns exhibited by the aforementioned time-tested strategies, retail investors should always monitor hedge fund and insider trading activity, and Walter Energy, Inc. (NYSE:WLT) applies perfectly to this mantra.