Are you looking to invest in technology companies? For this list we searched the tech sector for companies seeing bullish sentiment from not one, but two groups of sophisticated investors: institutional investors and company insiders.
Institutional investors are also known as "big money" investors. They represent big pools of money such as investment banks, pension funds, mutual funds, hedge funds, endowment funds, etc. When they invest in stocks, they can invest millions of dollars or more at one time. These transactions, called "block trades," can have a significant effect on share prices.
Because institutional investors handle such large amounts of money, it is easy enough to assume that the big money managers know what they are doing -- or at the very least know more than the average investor. This is why these investors are also sometimes referred to as "smart money."
If institutional investors start investing in a company, other investors can assume that some of the most talented analysts and money managers expect the company's share prices to increase over time. The stocks on our list are experiencing significant investment from the smart money.
Company insiders are another group of investors with sophisticated company information. After all, who knows a company better than the upper management and board members who work there? That's why investment activity is closely monitored and can tell us a lot about where they feel the business is heading.
Although insiders sell their company's shares for many reasons, when they buy their company's stock, it indicates that they have an optimistic outlook for the company. It may also indicate that they believe the stock is attractively priced.
The list
The following is a list of technology stocks, with market caps over $300 million, that we have screened for significant net institutional buying in the current quarter and significant net insider buying over the past six months.
These sophisticated investors feel there is more upside than downside to these names. Do you agree? (Click here to access free, interactive tools to analyze these ideas.)
1. Affymetrix (Nasdaq: AFFX): Engages in the development, manufacture, sale, and servicing of consumables and systems for genetic analysis in the life sciences and clinical health care markets. Market cap of $302.32M. Net institutional shares purchased over the current quarter at 3.5M, which is 6.23% of the company's 56.19M share float. Net insider shares purchased over the last six months at 5.0K, which is 0.01% of the company's 56.19M share float.
2. Cadence Design Systems (Nasdaq: CDNS): Develops electronic design automation software and hardware for customers worldwide. Market cap of $2.95B. Net institutional shares purchased over the current quarter at 2.2M, which is 0.81% of the company's 270.01M share float. Net insider shares purchased over the last six months at 55.0K, which is 0.02% of the company's 270.01M share float.
3. Convergys (NYSE: CVG): Provides relationship management solutions worldwide. Market cap of $1.51B. Net institutional shares purchased over the current quarter at 821.9K, which is 0.74% of the company's 111.44M share float. Net insider shares purchased over the last six months at 122.17K, which is 0.11% of the company's 111.44M share float.
4. GeoEye (Nasdaq: GEOY): Provides earth imagery and imagery information products, as well as image processing services to the United States and foreign government defense and intelligence organizations, domestic federal and foreign civil agencies, and commercial customers. Market cap of $420.06M. Net institutional shares purchased over the current quarter at 194.3K, which is 0.98% of the company's 19.92M share float. Net insider shares purchased over the last six months at 810.0K, which is 4.07% of the company's 19.92M share float.
5. Leap Wireless International (Nasdaq: LEAP): Provides digital wireless services. Market cap of $697.37M. Net institutional shares purchased over the current quarter at 2.7M, which is 5.53% of the company's 48.80M share float. Net insider shares purchased over the last six months at 40.0K, which is 0.08% of the company's 48.80M share float.
6. Level 3 Communications (Nasdaq: LVLT): Engages in the communications business in North America and Europe. Market cap of $4.25B. Net institutional shares purchased over the current quarter at 148.9M, which is 97.57% of the company's 152.61M share float. Net insider shares purchased over the last six months at 123.58K, which is 0.08% of the company's 152.61M share float.
7. Merge Healthcare (Nasdaq: MRGE): Provides health information technology interoperability solutions. Market cap of $457.03M. Net institutional shares purchased over the current quarter at 6.5M, which is 24.87% of the company's 26.14M share float. Net insider shares purchased over the last six months at 281.0K, which is 1.07% of the company's 26.14M share float.
8. Take-Two Interactive Software (Nasdaq: TTWO): Develops, and distributes interactive entertainment software, hardware, and accessories worldwide. Market cap of $1.18B. Net institutional shares purchased over the current quarter at 341.1K, which is 0.43% of the company's 78.43M share float. Net insider shares purchased over the last six months at 458.75K, which is 0.58% of the company's 78.43M share float.
9. MEMC Electronic Materials (NYSE: WFR): Engages in the development, manufacture, and sale of silicon wafers for the semiconductor industry worldwide. Market cap of $986.41M. Net institutional shares purchased over the current quarter at 9.2M, which is 4.01% of the company's 229.54M share float. Net insider shares purchased over the last six months at 12.30K, which is 0.01% of the company's 229.54M share float.
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Kapitall's Rebecca Lipman does not own any of the shares mentioned above. Institutional data sourced from Fidelity, insider data from Yahoo! Finance.
