Stillwater Mining Company (SWC): Are Hedge Funds Right About This Stock?
What has a smart Stillwater Mining Company (NYSE:SWC) investor to do?
In the eyes of many market players, hedge funds are assumed to be delayed, old financial tools of a forgotten age. Although there are In excess of 8,000 hedge funds trading currently, this site looks at the elite of this group, about 525 funds. Analysts calculate that this group controls most of the smart money's total assets, and by monitoring their highest performing stock picks, we've revealed a number of investment strategies that have historically beaten the S&P 500. 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 began to sharing our picks with our subscribers at the end of August 2012, we have trumped the S&P 500 index by 33 percentage points in 11 months (find the details here).
Just as crucial, bullish insider trading activity is a second way to analyze the world of equities. As the old adage goes: there are a number of motivations for an upper level exec 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 valuable potential of this tactic if you understand where to look (learn more here).
What's more, let's study the latest info for Stillwater Mining Company (NYSE:SWC).
What have hedge funds been doing with Stillwater Mining Company (NYSE:SWC)?
Heading into Q3, a total of 16 of the hedge funds we track held long positions in this stock, a change of -6% from the first quarter. With the smart money's sentiment swirling, there exists a select group of noteworthy hedge fund managers who were boosting their stakes significantly.
When using filings from the hedgies we track, Platinum Asset Management, managed by Kerr Neilson, holds the biggest position in Stillwater Mining Company (NYSE:SWC). Platinum Asset Management has a $174.1 million position in the stock, comprising 3.3% of its 13F portfolio. Coming in second is Clint Carlson of Carlson Capital, with a $52.2 million position; 0.6% of its 13F portfolio is allocated to the company. Remaining peers that are bullish include Ken Fisher's Fisher Asset Management, Peter Franklin Palmedo's Sun Valley Gold and Steven Cohen's SAC Capital Advisors.
Judging by the fact that Stillwater Mining Company (NYSE:SWC) has faced dropping sentiment from the entirety of the hedge funds we track, it's safe to say that there is a sect of hedge funds that slashed their full holdings in Q1. It's worth mentioning that SAC Subsidiary's CR Intrinsic Investors dropped the biggest investment of all the hedgies we key on, valued at about $5.2 million in stock, and Paul Tudor Jones of Tudor Investment Corp was right behind this move, as the fund said goodbye to about $1.9 million worth. These transactions are interesting, as total hedge fund interest fell by 1 funds in Q1.
How have insiders been trading Stillwater Mining Company (NYSE:SWC)?
Insider buying is at its handiest when the primary stock in question has experienced transactions within the past 180 days. Over the last six-month time frame, Stillwater Mining Company (NYSE:SWC) 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 Stillwater Mining Company (NYSE:SWC). These stocks are Arch Coal Inc (NYSE:ACI), U.S. Silica Holdings Inc (NYSE:SLCA), Alpha Natural Resources, Inc. (NYSE:ANR), Walter Energy, Inc. (NYSE:WLT), and HudBay Minerals Inc Ord Shs (NYSE:HBM). This group of stocks are in the industrial metals & minerals industry and their market caps resemble SWC's market cap.
# of Hedge Funds
# of Insiders Buying
# of Insiders Selling
Arch Coal Inc (NYSE:ACI)
U.S. Silica Holdings Inc (NYSE:SLCA)
Alpha Natural Resources, Inc. (NYSE:ANR)
Walter Energy, Inc. (NYSE:WLT)
HudBay Minerals Inc Ord Shs (NYSE:HBM)
Using the returns explained by the previously mentioned studies, average investors must always track hedge fund and insider trading sentiment, and Stillwater Mining Company (NYSE:SWC) is an important part of this process.