This Metric Says You Are Smart to Sell J.B. Hunt Transport Services, Inc. (JBHT)
What's a smart J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT) investor to do?
If you were to ask many of your fellow readers, hedge funds are assumed to be delayed, old financial vehicles of a forgotten age. Although there are over 8,000 hedge funds with their doors open today, Insider Monkey looks at the upper echelon of this group, close to 525 funds. It is assumed that this group controls the lion's share of the smart money's total assets, and by paying attention to their highest quality stock picks, we've unsheathed a number of investment strategies that have historically outstripped the broader indices. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points annually 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 outpaced the S&P 500 index by 33 percentage points in 11 months (explore the details and some picks here).
Just as necessary, bullish insider trading activity is another way to look at the financial markets. Just as you'd expect, there are lots of stimuli for a corporate insider to get rid of shares of his or her company, but only one, very clear reason why they would initiate a purchase. Several empirical studies have demonstrated the useful potential of this strategy if shareholders understand what to do (learn more here).
What's more, let's analyze the latest info surrounding J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT).
What have hedge funds been doing with J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT)?
At the end of the second quarter, a total of 16 of the hedge funds we track were bullish in this stock, a change of -11% from the first quarter. With hedge funds' positions undergoing their usual ebb and flow, there exists an "upper tier" of key hedge fund managers who were increasing their stakes considerably.
When using filings from the hedgies we track, Stephen Mandel's Lone Pine Capital had the largest position in J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT), worth close to $204.6 million, accounting for 1% of its total 13F portfolio. Sitting at the No. 2 spot is Michael R. Weisberg of Crestwood Capital Management, with a $36.2 million position; the fund has 5.1% of its 13F portfolio invested in the stock. Remaining peers with similar optimism include Steven Cohen's SAC Capital Advisors, Michael Karsch's Karsch Capital Management and David Harding's Winton Capital Management.
Due to the fact J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT) has witnessed a fall in interest from the top-tier hedge fund industry, it's easy to see that there exists a select few fund managers who sold off their positions entirely in Q1. Intriguingly, Andrew Sandler's Sandler Capital Management sold off the largest investment of the "upper crust" of funds we watch, totaling about $29 million in call options.. John Fichthorn's fund, Dialectic Capital Management, also said goodbye to its call options., about $7.4 million worth. These transactions are interesting, as aggregate hedge fund interest was cut by 2 funds in Q1.
How are insiders trading J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT)?
Bullish insider trading is particularly usable when the company in question has experienced transactions within the past 180 days. Over the latest 180-day time period, J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We'll also take a look at the relationship between both of these indicators in other stocks similar to J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT). These stocks are Werner Enterprises, Inc. (NASDAQ:WERN), Con-way Inc (NYSE:CNW), Swift Transportation Co (NYSE:SWFT), Landstar System, Inc. (NASDAQ:LSTR), and Old Dominion Freight Line (NASDAQ:ODFL). This group of stocks are the members of the trucking industry and their market caps match JBHT's market cap.
# of Hedge Funds
# of Insiders Buying
# of Insiders Selling
Werner Enterprises, Inc. (NASDAQ:WERN)
Con-way Inc (NYSE:CNW)
Swift Transportation Co (NYSE:SWFT)
Landstar System, Inc. (NASDAQ:LSTR)
Old Dominion Freight Line (NASDAQ:ODFL)
Using the results demonstrated by our studies, regular investors must always track hedge fund and insider trading activity, and J.B. Hunt Transport Services, Inc. (NASDAQ:JBHT) applies perfectly to this mantra.