Should You Buy SLM Corp (SLM)?

SLM Corp (NASDAQ:SLM) was in 35 hedge funds’ portfolios at the end of September. SLM investors should pay attention to an increase in enthusiasm from smart money recently. There were 32 hedge funds in hedge fund experts Insider Monkey’s database with SLM positions at the end of the previous quarter.


According to Zacks Investment Research, Sallie Mae’s third-quarter 2013 core earnings per share beat the Zacks Consensus Estimate. Results primarily benefited from a fall in loan loss provision. However, a drop in net interest income and higher operating expenses were the headwinds.

Keeping this in mind, let’s take a peek at the latest action surrounding SLM Corp (NASDAQ:SLM).

How are hedge funds trading SLM Corp (NASDAQ:SLM)?

Heading into Q4, a total of 35 of the hedge funds Insider Monkey tracks held long positions in this stock, a change of 9% from the second quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were upping their stakes considerably.

According to hedge fund experts at Insider Monkey, Jonathon Jacobson’s Highfields Capital Management had the most valuable position in SLM Corp (NASDAQ:SLM), worth close to $389.8 million, amounting to 3.1% of its total 13F portfolio. Sitting at the No. 2 spot is Leon Cooperman of Omega Advisors, with a $321.6 million position; 4.9% of its 13F portfolio is allocated to the company. Other hedge funds that are bullish include David Abrams’s Abrams Capital Management, D. E. Shaw’s D E Shaw and Donald Chiboucis’s Columbus Circle Investors.

As industrywide interest jumped, some big names were breaking ground themselves. Orbis Investment Management, managed by William B. Gray, assembled the largest position in SLM Corp (NASDAQ:SLM). Orbis Investment Management had 108.6 million invested in the company at the end of the quarter. Paul Orlin and Alex Porter’s Amici Capital also initiated a $20.1 million position during the quarter. The other funds with new positions in the stock are Peter Muller’s PDT Partners, Dmitry Balyasny’s Balyasny Asset Management, and David S. Winter and David J. Millstone’s 40 North Management.

Insider trading activity in SLM Corp (NASDAQ:SLM)

Insider purchases made by high-level executives is particularly usable when the company in question has experienced transactions within the past 180 days. Over the latest half-year time period, SLM Corp (NASDAQ:SLM) has experienced zero unique insiders purchasing, and 3 insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to SLM Corp (NASDAQ:SLM). These stocks are Discover Financial Services (NYSE:DFS), ORIX Corporation (ADR) (NYSE:IX), Equifax Inc. (NYSE:EFX), The Western Union Company (NYSE:WU), and CIT Group Inc. (NYSE:CIT). This group of stocks belong to the credit services industry and their market caps resemble SLM’s market cap.

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Discover Financial Services (NYSE:DFS) 46 0 8
ORIX Corporation (ADR) (NYSE:IX) 5 0 0
Equifax Inc. (NYSE:EFX) 28 0 5
The Western Union Company (NYSE:WU) 34 0 2
CIT Group Inc. (NYSE:CIT) 48 0 0

CIT Group Inc. and The Western Union Company are the most widely held credit services industry stocks among the hedge funds Insider Monkey tracks, as the chart above indicates.



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