Eye Of The Lion: LionEye Keeps Buying Sinking Shares Of This Restaurant

The changes going on at Famous Dave’s of America, Inc. (NASDAQ:DAVE) have sparked the attention of smart money as well. The number of hedge funds among those that we track with a stake in the company increased to ten at the end of March from seven at the end of the previous quarter. Jonathan Lennon‘s Pleasant Lake Partners is the largest stockholder of Famous Dave’s of America, Inc. (NASDAQ:DAVE) among these, holding some 923,400 shares valued at $26.32 million.

LionEye initiated a position in its other food-related pick, Darling Ingredients Inc (NYSE:DAR), during the first quarter, adding 679,500 shares valued at $9.52 million. The $2.47 billion company hasn’t performed much better than its smaller counterpart. Its stock has depreciated by almost 18% year-to-date.

Although Darling Ingredients Inc (NYSE:DAR)’s finnacial results for the first quarter were more towards the disappointing side, the outlook for the second quarter is promising. As part of its restructuring effort the company is continuing to shutter plants that are weighing down its bottom line and also instituting changes in other segments, such as restaurant services, to make them more efficient. For restaurant services, Darling Ingredients Inc (NYSE:DAR) lowered raw material payments to suppliers and also decreased its workforce during the first trimester.

LionEye isn’t the only fund that endorsed Darling Ingredients Inc (NYSE:DAR) during the first quarter. The hedge fund interest in the company increased significantly during the first three months as 34 firms had invested a total of $631.70 million into the company as compared to 29 funds with $867.56 million at the end of the previous quarter (the large dip in overall capital invested can largely be explained by the shares’ poor performance during the quarter, as they lost over 21% of their value). Frank Brosens‘ Taconic Capital also initiated a position in Darling Ingredients Inc (NYSE:DAR) during the trimester, consisting of 1.3 million shares valued at $18.21 million.

Disclosure: None