Arcos Dorados Holding Inc (NYSE:ARCO) was in 10 hedge funds' portfolio at the end of the first quarter of 2013. ARCO has experienced a decrease in support from the world's most elite money managers recently. There were 11 hedge funds in our database with ARCO positions at the end of the previous quarter.
To most stock holders, hedge funds are perceived as unimportant, outdated financial vehicles of years past. While there are over 8000 funds in operation at present, we choose to focus on the top tier of this club, around 450 funds. It is widely believed that this group controls most of all hedge funds' total capital, and by watching their best stock picks, we have found a few investment strategies that have historically outpaced Mr. Market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we've began to sharing our picks with our subscribers at the end of August 2012, we have outclassed the S&P 500 index by 23.3 percentage points in 8 months (see the details here).
Just as key, bullish insider trading activity is another way to parse down the world of equities. There are a number of stimuli for a corporate insider to sell shares of his or her company, but just one, very obvious reason why they would behave bullishly. Plenty of academic studies have demonstrated the impressive potential of this strategy if piggybackers understand what to do (learn more here).
With these "truths" under our belt, it's important to take a gander at the key action surrounding Arcos Dorados Holding Inc (NYSE:ARCO).
At Q1's end, a total of 10 of the hedge funds we track were long in this stock, a change of -9% from one quarter earlier. With hedgies' capital changing hands, there exists a few notable hedge fund managers who were boosting their holdings substantially.
According to our comprehensive database, Jim Simons's Renaissance Technologies had the most valuable position in Arcos Dorados Holding Inc (NYSE:ARCO), worth close to $11.7 million, comprising less than 0.1%% of its total 13F portfolio. Coming in second is Charles Clough of Clough Capital Partners, with a $9.7 million position; 0.4% of its 13F portfolio is allocated to the company. Other hedgies that hold long positions include Israel Englander's Millennium Management, Howard Marks's Oaktree Capital Management and D. E. Shaw's D E Shaw.
Due to the fact that Arcos Dorados Holding Inc (NYSE:ARCO) has experienced bearish sentiment from the aggregate hedge fund industry, it's easy to see that there was a specific group of fund managers that elected to cut their full holdings at the end of the first quarter. At the top of the heap, James Crichton and Adam Weiss's Scout Capital Management cut the biggest stake of the "upper crust" of funds we track, totaling an estimated $23 million in stock.. Chase Coleman and Feroz Dewan's fund, Tiger Global Management LLC, also cut its stock, about $15.1 million worth. These moves are interesting, as aggregate hedge fund interest dropped by 1 funds at the end of the first quarter.
Insider purchases made by high-level executives is at its handiest when the company in focus has experienced transactions within the past 180 days. Over the last 180-day time frame, Arcos Dorados Holding Inc (NYSE:ARCO) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let's also take a look at hedge fund and insider activity in other stocks similar to Arcos Dorados Holding Inc (NYSE:ARCO). These stocks are The Cheesecake Factory Incorporated (NASDAQ:CAKE), Bloomin' Brands Inc (NASDAQ:BLMN), The Wendy's Company (NASDAQ:WEN), Domino's Pizza, Inc. (NYSE:DPZ), and Brinker International, Inc. (NYSE:EAT). This group of stocks are the members of the restaurants industry and their market caps are closest to ARCO's market cap.