Should Flowers Foods, Inc. (NYSE:FLO) investors track the following data?
If you were to ask many investors, hedge funds are viewed as useless, old investment tools of a period lost to current times. Although there are more than 8,000 hedge funds trading in present day, this site aim at the crème de la crème of this club, about 525 funds. It is widely held that this group oversees most of all hedge funds' total assets, and by watching their highest quality stock picks, we've unearthed a few investment strategies that have historically beaten the market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points a year 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 beaten the S&P 500 index by 33 percentage points in 11 months (find a sample of our picks).
Equally as crucial, optimistic insider trading activity is another way to analyze the world of equities. Obviously, there are a number of reasons for a corporate insider to get rid of shares of his or her company, but just one, very obvious reason why they would behave bullishly. Several academic studies have demonstrated the useful potential of this tactic if investors know what to do (learn more here).
Thus, let's analyze the recent info about Flowers Foods, Inc. (NYSE:FLO).
Heading into Q3, a total of 25 of the hedge funds we track were long in this stock, a change of 47% from the previous quarter. With hedgies' sentiment swirling, there exists a select group of notable hedge fund managers who were boosting their holdings considerably.
Out of the hedge funds we follow, John Lykouretzos's Hoplite Capital Management had the biggest position in Flowers Foods, Inc. (NYSE:FLO), worth close to $85.9 million, comprising 3% of its total 13F portfolio. On Hoplite Capital Management's heels is Ken Griffin of Citadel Investment Group, with a $82.4 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining hedgies that are bullish include Jim Simons's Renaissance Technologies, Donald Chiboucis's Columbus Circle Investors and Steven Cohen's SAC Capital Advisors.
Now, certain bigger names have been driving this bullishness. Hoplite Capital Management, managed by John Lykouretzos, initiated the biggest position in Flowers Foods, Inc. (NYSE:FLO). Hoplite Capital Management had 85.9 million invested in the company at the end of the quarter. Ken Griffin's Citadel Investment Group also initiated a $82.4 million position during the quarter. The following funds were also among the new FLO investors: Jim Simons's Renaissance Technologies, Donald Chiboucis's Columbus Circle Investors, and Steven Cohen's SAC Capital Advisors.
Insider buying is at its handiest when the company in question has experienced transactions within the past 180 days. Over the latest 180-day time frame, Flowers Foods, Inc. (NYSE:FLO) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We'll also take a look at the relationship between both of these indicators in other stocks similar to Flowers Foods, Inc. (NYSE:FLO). These stocks are Gruma S.A.B. de C.V. (ADR) (NYSE:GMK), The Hain Celestial Group, Inc. (NASDAQ:HAIN), Ingredion Inc (NYSE:INGR), Ralcorp Holdings, Inc. (NYSE:RAH), and Hillshire Brands Co (NYSE:HSH). This group of stocks belong to the processed & packaged goods industry and their market caps are similar to FLO's market cap.