Hedge Funds Are Dumping Tennant Company (TNC)
Should Tennant Company (NYSE:TNC) investors track the following data?
At the moment, there are dozens of methods investors can use to watch Mr. Market. A pair of the most useful are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best money managers can trounce the S&P 500 by a healthy amount (see just how much).
Just as useful, bullish insider trading sentiment is another way to look at the marketplace. As the old adage goes: there are lots of incentives for a corporate insider to sell shares of his or her company, but just one, very clear reason why they would buy. Various empirical studies have demonstrated the impressive potential of this strategy if piggybackers understand where to look (learn more here).
Keeping this in mind, it's important to examine the latest info for Tennant Company (NYSE:TNC).
How have hedgies been trading Tennant Company (NYSE:TNC)?
At Q2's end, a total of 9 of the hedge funds we track were long in this stock, a change of -18% from the first quarter. With hedgies' sentiment swirling, there exists an "upper tier" of noteworthy hedge fund managers who were boosting their holdings substantially.
According to our 13F database, Chuck Royce's Royce & Associates had the most valuable position in Tennant Company (NYSE:TNC), worth close to $73.4 million, comprising 0.2% of its total 13F portfolio. On Royce & Associates's heels is GAMCO Investors, managed by Mario Gabelli, which held a $22.8 million position; 0.1% of its 13F portfolio is allocated to the stock. Other hedgies that are bullish include Jim Simons's Renaissance Technologies, Joel Greenblatt's Gotham Asset Management and Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital.
Due to the fact Tennant Company (NYSE:TNC) has experienced dropping sentiment from upper-tier hedge fund managers, logic holds that there exists a select few money managers who sold off their entire stakes last quarter. Interestingly, Drew Cupps's Cupps Capital Management sold off the largest investment of the 450+ funds we track, comprising an estimated $4.3 million in call options., and Matthew Hulsizer of Peak6 Capital Management was right behind this move, as the fund sold off about $0.6 million worth. These transactions are interesting, as total hedge fund interest was cut by 2 funds last quarter.
What do corporate executives and insiders think about Tennant Company (NYSE:TNC)?
Legal insider trading, particularly when it's bullish, is at its handiest when the primary stock in question has seen transactions within the past six months. Over the last 180-day time period, Tennant Company (NYSE:TNC) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
We'll check out the relationship between both of these indicators in other stocks similar to Tennant Company (NYSE:TNC). These stocks are CECO Environmental Corp. (NASDAQ:CECE), ADA-ES, Inc. (NASDAQ:ADES), Heritage-Crystal Clean, Inc. (NASDAQ:HCCI), CLARCOR Inc. (NYSE:CLC), and Calgon Carbon Corporation (NYSE:CCC). This group of stocks are the members of the pollution & treatment controls industry and their market caps are similar to TNC's market cap.
# of Hedge Funds
# of Insiders Buying
# of Insiders Selling
CECO Environmental Corp. (NASDAQ:CECE)
ADA-ES, Inc. (NASDAQ:ADES)
Heritage-Crystal Clean, Inc. (NASDAQ:HCCI)
CLARCOR Inc. (NYSE:CLC)
Calgon Carbon Corporation (NYSE:CCC)
Using the results demonstrated by the previously mentioned strategies, regular investors must always keep one eye on hedge fund and insider trading sentiment, and Tennant Company (NYSE:TNC) shareholders fit into this picture quite nicely.