Semtech Corporation (SMTC): Insiders Aren’t Crazy About It But Hedge Funds Love It
Should Semtech Corporation (NASDAQ:SMTC) investors track the following data?
In the financial world, there are plenty of gauges investors can use to watch Mr. Market. Some of the most under-the-radar are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite investment managers can beat the broader indices by a solid margin (see just how much).
Just as key, positive insider trading activity is another way to look at the investments you're interested in. Obviously, there are a number of motivations for an insider to cut shares of his or her company, but only one, very simple reason why they would buy. Plenty of empirical studies have demonstrated the useful potential of this tactic if you know where to look (learn more here).
Thus, let's study the recent info surrounding Semtech Corporation (NASDAQ:SMTC).
How are hedge funds trading Semtech Corporation (NASDAQ:SMTC)?
At the end of the second quarter, a total of 14 of the hedge funds we track were long in this stock, a change of 27% from the first quarter. With the smart money's sentiment swirling, there exists a few notable hedge fund managers who were boosting their stakes meaningfully.
According to our 13F database, Robert B. Gillam's McKinley Capital Management had the biggest position in Semtech Corporation (NASDAQ:SMTC), worth close to $7.7 million, comprising 0.4% of its total 13F portfolio. On McKinley Capital Management's heels is Brian Ashford-Russell and Tim Woolley of Polar Capital, with a $6 million position; 0.2% of its 13F portfolio is allocated to the stock. Remaining hedge funds with similar optimism include Drew Cupps's Cupps Capital Management, Matthew Tewksbury's Stevens Capital Management and D. E. Shaw's D E Shaw.
As industrywide interest increased, certain money managers have jumped into Semtech Corporation (NASDAQ:SMTC) headfirst. McKinley Capital Management, managed by Robert B. Gillam, created the largest position in Semtech Corporation (NASDAQ:SMTC). McKinley Capital Management had 7.7 million invested in the company at the end of the quarter. Brian Ashford-Russell and Tim Woolley's Polar Capital also initiated a $6 million position during the quarter. The other funds with brand new SMTC positions are Drew Cupps's Cupps Capital Management, Matthew Tewksbury's Stevens Capital Management, and D. E. Shaw's D E Shaw.
What have insiders been doing with Semtech Corporation (NASDAQ:SMTC)?
Insider buying made by high-level executives is at its handiest when the company in focus has seen transactions within the past half-year. Over the latest 180-day time period, Semtech Corporation (NASDAQ:SMTC) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We'll also review the relationship between both of these indicators in other stocks similar to Semtech Corporation (NASDAQ:SMTC). These stocks are IPG Photonics Corporation (NASDAQ:IPGP), Fairchild Semiconductor Intl Inc (NYSE:FCS), Semiconductor Manufacturing Int'l (ADR) (NYSE:SMI), Hittite Microwave Corp (NASDAQ:HITT), and Microsemi Corporation (NASDAQ:MSCC). All of these stocks are in the semiconductor - integrated circuits industry and their market caps are closest to SMTC's market cap.
# of Hedge Funds
# of Insiders Buying
# of Insiders Selling
IPG Photonics Corporation (NASDAQ:IPGP)
Fairchild Semiconductor Intl Inc (NYSE:FCS)
Semiconductor Manufacturing Int'l (ADR) (NYSE:SMI)
Hittite Microwave Corp (NASDAQ:HITT)
Microsemi Corporation (NASDAQ:MSCC)
Using the results shown by the previously mentioned tactics, average investors should always keep one eye on hedge fund and insider trading activity, and Semtech Corporation (NASDAQ:SMTC) applies perfectly to this mantra.