Alaska Air Group, Inc. (ALK): Hedge Funds Are Bullish and Insiders Are Undecided, What Should You Do?
To the average investor, there are a multitude of methods shareholders can use to analyze Mr. Market. Two of the most useful are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top investment managers can beat their index-focused peers by a superb amount (see just how much).
Just as necessary, positive insider trading activity is a second way to look at the financial markets. As the old adage goes: there are plenty of stimuli for an upper level exec to drop shares of his or her company, but only one, very clear reason why they would behave bullishly. Several academic studies have demonstrated the valuable potential of this strategy if shareholders understand what to do (learn more here).
Furthermore, let's examine the recent info about Alaska Air Group, Inc. (NYSE:ALK).
How are hedge funds trading Alaska Air Group, Inc. (NYSE:ALK)?
At the end of the second quarter, a total of 31 of the hedge funds we track held long positions in this stock, a change of 29% from one quarter earlier. With the smart money's sentiment swirling, there exists a select group of noteworthy hedge fund managers who were upping their stakes meaningfully.
When using filings from the hedgies we track, Jim Simons's Renaissance Technologies had the biggest position in Alaska Air Group, Inc. (NYSE:ALK), worth close to $238.7 million, accounting for 0.6% of its total 13F portfolio. Coming in second is PAR Capital Management, managed by Paul Reeder and Edward Shapiro, which held a $219 million position; 6.2% of its 13F portfolio is allocated to the company. Some other peers that are bullish include Cliff Asness's AQR Capital Management, Brad Gerstner's Altimeter Capital Management and Israel Englander's Millennium Management.
As industrywide interest increased, particular hedge funds have jumped into Alaska Air Group, Inc. (NYSE:ALK) headfirst. Renaissance Technologies, managed by Jim Simons, assembled the biggest position in Alaska Air Group, Inc. (NYSE:ALK). Renaissance Technologies had 238.7 million invested in the company at the end of the quarter. Paul Reeder and Edward Shapiro's PAR Capital Management also initiated a $219 million position during the quarter. The other funds with new positions in the stock are Cliff Asness's AQR Capital Management, Brad Gerstner's Altimeter Capital Management, and Israel Englander's Millennium Management.
Insider trading activity in Alaska Air Group, Inc. (NYSE:ALK)
Insider buying is particularly usable when the primary stock in question has experienced transactions within the past six months. Over the last half-year time period, Alaska Air Group, Inc. (NYSE:ALK) has seen 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 Alaska Air Group, Inc. (NYSE:ALK). These stocks are Allegiant Travel Company (NASDAQ:ALGT), LATAM Airlines Group SA (ADR) (NYSE:LFL), JetBlue Airways Corporation (NASDAQ:JBLU), Southwest Airlines Co. (NYSE:LUV), and Copa Holdings, S.A. (NYSE:CPA). All of these stocks are in the regional airlines industry and their market caps are closest to ALK's market cap.
# of Hedge Funds
# of Insiders Buying
# of Insiders Selling
Allegiant Travel Company (NASDAQ:ALGT)
LATAM Airlines Group SA (ADR) (NYSE:LFL)
JetBlue Airways Corporation (NASDAQ:JBLU)
Southwest Airlines Co. (NYSE:LUV)
Copa Holdings, S.A. (NYSE:CPA)
Using the returns shown by Insider Monkey's tactics, regular investors should always track hedge fund and insider trading sentiment, and Alaska Air Group, Inc. (NYSE:ALK) applies perfectly to this mantra.