Hedge Funds Aren’t Crazy About NetApp Inc. (NTAP) Anymore

NetApp Inc. (NASDAQ:NTAP) investors should pay attention to a decrease in activity from the world’s largest hedge funds lately. NTAP was in 43 hedge funds’ portfolio at the end of the third quarter of 2013. There were 50 hedge funds in hedge fund experts Insider Monkey’s database with NTAP positions at the end of the previous quarter.


Recently the company “announced the general availability of the industry-recognized NetApp Certified Storage Associate (NCSA) program. An accelerated entry-level certification credential, the NCSA program is designed to familiarize participants with storage technology and terminology, NetApp® products and solutions, and the skills to manage systems that utilize the NetApp Data ONTAP® architecture, the world’s #1 branded storage OS.”

Keeping this in mind, it’s important to take a glance at the recent action regarding NetApp Inc. (NASDAQ:NTAP).

Hedge fund activity in NetApp Inc. (NASDAQ:NTAP)

At Q3′s end, a total of 43 of the hedge funds we track were long in this stock, a change of -14 percent from the previous quarter. With hedgies’ capital changing hands, there exists a select group of key hedge fund managers who were upping their holdings substantially.

According to hedge fund intelligence website Insider Monkey, Elliott Management, managed by Paul Singer, holds the largest position in NetApp Inc. (NASDAQ:NTAP). Elliott Management has a $458 million position in the stock, comprising 8.4 percent of its 13F portfolio. The second largest stake is held by George Soros of Soros Fund Management, with a $205.3 million position; 2.2 percent of its 13F portfolio is allocated to the company. Remaining hedge funds that hold long positions encompass Lee Ainslie’s Maverick Capital, Paul Orlin and Alex Porter’s Amici Capital and Matt Sirovich and Jeremy Mindich’s Scopia Capital.

Because NetApp Inc. (NASDAQ:NTAP) has faced falling interest from the smart money, we can see that there lies a certain “tier” of hedgies that elected to cut their entire stakes last quarter. It’s worth mentioning that Larry Robbins’s Glenview Capital said goodbye to the biggest position of the “upper crust” of funds tracked by Insider Monkey, comprising an estimated $108.5 million in call options., and Ricky Sandler of Eminence Capital was right behind this move, as the fund sold off about $79.4 million worth. These moves are important to note, as total hedge fund interest was cut by seven funds last quarter.

How have insiders been trading NetApp Inc. (NASDAQ:NTAP)?

Bullish insider trading is particularly usable when the company in focus has experienced transactions within the past six months. Over the last 180-day time period, NetApp Inc. (NASDAQ:NTAP) has seen zero unique insiders purchasing, and seven insider sales (see the details of insider trades here).

Let’s check out hedge fund and insider activity in other stocks similar to NetApp Inc. (NASDAQ:NTAP). These stocks are Brocade Communications Systems, Inc. (NASDAQ:BRCD), EMC Corporation (NYSE:EMC), SanDisk Corporation (NASDAQ:SNDK), Seagate Technology PLC (NASDAQ:STX), and Western Digital Corp. (NASDAQ:WDC). This group of stocks belong to the data storage devices industry and their market caps resemble NTAP’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Brocade Communications Systems, Inc. (NASDAQ:BRCD) 29 0 3
EMC Corporation (NYSE:EMC) 54 0 13
SanDisk Corporation (NASDAQ:SNDK) 53 0 10
Seagate Technology PLC (NASDAQ:STX) 30 1 14
Western Digital Corp. (NASDAQ:WDC) 35 0 12

43 hedge funds tracked by the experts at Insider Monkey hold NetApp Inc. That’s not as many as are long EMC Corporation and SanDisk Corporation, but it is still an immensely popular data storage device industry holding.



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