Hedge Funds Are Betting On Intuit Inc. (INTU)
Intuit Inc. (NASDAQ:INTU) investors: pay attention.
Now, according to many of your peers, hedge funds are perceived as useless, old investment tools of an era lost to time. Although there are In excess of 8,000 hedge funds trading currently, Insider Monkey aim at the bigwigs of this club, around 525 funds. It is widely held that this group controls the majority of the smart money's total assets, and by keeping an eye on their highest performing investments, we've formulated a number of investment strategies that have historically beaten the market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points a year 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 beaten the S&P 500 index by 33 percentage points in 11 months (find the details here).
Just as key, positive insider trading activity is another way to analyze the financial markets. As the old adage goes: there are lots of stimuli for an insider to get rid of shares of his or her company, but only one, very simple reason why they would behave bullishly. Many academic studies have demonstrated the impressive potential of this method if "monkeys" know what to do (learn more here).
Now that that's out of the way, it's important to discuss the latest info surrounding Intuit Inc. (NASDAQ:INTU).
What have hedge funds been doing with Intuit Inc. (NASDAQ:INTU)?
In preparation for the third quarter, a total of 32 of the hedge funds we track were bullish in this stock, a change of 3% from the first quarter. With hedge funds' sentiment swirling, there exists a select group of noteworthy hedge fund managers who were boosting their stakes considerably.
Out of the hedge funds we follow, Generation Investment Management, managed by David Blood and Al Gore, holds the biggest position in Intuit Inc. (NASDAQ:INTU). Generation Investment Management has a $386.7 million position in the stock, comprising 7.5% of its 13F portfolio. The second largest stake is held by James Crichton and Adam Weiss of Scout Capital Management, with a $128.2 million position; 2.1% of its 13F portfolio is allocated to the company. Other hedge funds that hold long positions include Robert Joseph Caruso's Select Equity Group, Ken Griffin's Citadel Investment Group and Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital.
As aggregate interest spiked, certain bigger names were leading the bulls' herd. Generation Investment Management, managed by David Blood and Al Gore, created the most valuable position in Intuit Inc. (NASDAQ:INTU). Generation Investment Management had 386.7 million invested in the company at the end of the quarter. James Crichton and Adam Weiss's Scout Capital Management also initiated a $128.2 million position during the quarter. The following funds were also among the new INTU investors: Robert Joseph Caruso's Select Equity Group, Ken Griffin's Citadel Investment Group, and Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital.
How are insiders trading Intuit Inc. (NASDAQ:INTU)?
Insider buying is at its handiest when the primary stock in question has experienced transactions within the past six months. Over the last half-year time frame, Intuit Inc. (NASDAQ:INTU) has seen zero unique insiders buying, 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 Intuit Inc. (NASDAQ:INTU). These stocks are Workday Inc (NYSE:WDAY), Catamaran Corp (USA) (NASDAQ:CTRX), CA, Inc. (NASDAQ:CA), salesforce.com, inc. (NYSE:CRM), and Adobe Systems Incorporated (NASDAQ:ADBE). All of these stocks are in the application software industry and their market caps are closest to INTU's market cap.
# of Hedge Funds
# of Insiders Buying
# of Insiders Selling
Workday Inc (NYSE:WDAY)
Catamaran Corp (USA) (NASDAQ:CTRX)
CA, Inc. (NASDAQ:CA)
salesforce.com, inc. (NYSE:CRM)
Adobe Systems Incorporated (NASDAQ:ADBE)
Using the returns shown by our strategies, average investors should always keep one eye on hedge fund and insider trading activity, and Intuit Inc. (NASDAQ:INTU) shareholders fit into this picture quite nicely.