Is MakeMyTrip Limited (NASDAQ:MMYT) a buy right now? The best stock pickers are betting on the stock. The number of bullish hedge fund bets improved by 1 in recent months.
To the average investor, there are dozens of metrics investors can use to track their holdings. A pair of the most underrated are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the top fund managers can beat the S&P 500 by a significant margin (see just how much).
Just as beneficial, optimistic insider trading activity is another way to parse down the stock market universe. There are a variety of motivations for a corporate insider to cut shares of his or her company, but only one, very clear reason why they would initiate a purchase. Many academic studies have demonstrated the impressive potential of this strategy if “monkeys” understand what to do (learn more here).
With these “truths” under our belt, we’re going to take a look at the key action regarding MakeMyTrip Limited (NASDAQ:MMYT).
How have hedgies been trading MakeMyTrip Limited (NASDAQ:MMYT)?
Heading into 2013, a total of 5 of the hedge funds we track held long positions in this stock, a change of 25% from one quarter earlier. With hedge funds’ sentiment swirling, there exists a select group of notable hedge fund managers who were increasing their holdings significantly.
When looking at the hedgies we track, Tiger Global Management LLC, managed by Chase Coleman and Feroz Dewan, holds the biggest position in MakeMyTrip Limited (NASDAQ:MMYT). Tiger Global Management LLC has a $89 million position in the stock, comprising 1.7% of its 13F portfolio. On Tiger Global Management LLC’s heels is Eric Semler of TCS Capital Management, with a $2 million position; the fund has 1.5% of its 13F portfolio invested in the stock. Remaining hedgies that hold long positions include D. E. Shaw’s D E Shaw, Ken Griffin’s Citadel Investment Group and Jim Simons’s Renaissance Technologies.
Consequently, specific money managers have been driving this bullishness. TCS Capital Management, managed by Eric Semler, assembled the biggest position in MakeMyTrip Limited (NASDAQ:MMYT). TCS Capital Management had 2 million invested in the company at the end of the quarter.
Insider trading activity in MakeMyTrip Limited (NASDAQ:MMYT)
Insider purchases made by high-level executives is most useful when the company in question has seen transactions within the past 180 days. Over the latest six-month time period, MakeMyTrip Limited (NASDAQ:MMYT) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to MakeMyTrip Limited (NASDAQ:MMYT). These stocks are Carnival plc (ADR) (NYSE:CUK), Six Flags Entertainment Corp (NYSE:SIX), Cedar Fair, L.P. (NYSE:FUN), Premier Exhibitions, Inc. (NASDAQ:PRXI), and Orbitz Worldwide, Inc. (NYSE:OWW). This group of stocks belong to the general entertainment industry and their market caps are similar to MMYT’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Carnival plc (ADR) (NYSE:CUK)||4||0||12|
|Six Flags Entertainment Corp (NYSE:SIX)||30||1||5|
|Cedar Fair, L.P. (NYSE:FUN)||10||2||0|
|Premier Exhibitions, Inc. (NASDAQ:PRXI)||1||0||0|
|Orbitz Worldwide, Inc. (NYSE:OWW)||8||0||4|
With the results demonstrated by the aforementioned strategies, retail investors should always watch hedge fund and insider trading activity, and MakeMyTrip Limited (NASDAQ:MMYT) shareholders fit into this picture quite nicely.
Insider Monkey’s small-cap strategy returned 37% between September 2012 and March 2013 versus 12.9% for the S&P 500 index. Try it now by clicking the link above.