Is Francesca's Holdings Corp (NASDAQ:FRAN) a safe stock to buy now? The smart money is betting on the stock. The number of bullish hedge fund bets increased by 11 recently.
At the moment, there are many indicators market participants can use to monitor publicly traded companies. Some of the most useful are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top fund managers can beat the broader indices by a healthy amount (see just how much).
Just as integral, optimistic insider trading sentiment is another way to parse down the stock market universe. Just as you'd expect, there are a number of reasons for a bullish insider to get rid of shares of his or her company, but just one, very simple reason why they would behave bullishly. Several academic studies have demonstrated the market-beating potential of this strategy if you know where to look (learn more here).
Keeping this in mind, we're going to take a look at the key action regarding Francesca's Holdings Corp (NASDAQ:FRAN).
In preparation for this year, a total of 21 of the hedge funds we track were bullish in this stock, a change of 110% from the third quarter. With hedge funds' positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were boosting their stakes substantially.
According to our comprehensive database, Daruma Asset Management, managed by Mariko Gordon, holds the most valuable position in Francesca's Holdings Corp (NASDAQ:FRAN). Daruma Asset Management has a $45 million position in the stock, comprising 2.6% of its 13F portfolio. The second largest stake is held by Phill Gross and Robert Atchinson of Adage Capital Management, with a $40 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Remaining hedgies that hold long positions include Donald Chiboucis's Columbus Circle Investors, Tiger Global Management LLC and David Gallo's Valinor Management LLC.
Consequently, key hedge funds have been driving this bullishness. Daruma Asset Management, managed by Mariko Gordon, established the most valuable position in Francesca's Holdings Corp (NASDAQ:FRAN). Daruma Asset Management had 45 million invested in the company at the end of the quarter. Phill Gross and Robert Atchinson's Adage Capital Management also made a $40 million investment in the stock during the quarter. The other funds with brand new positions are Tiger Global Management LLC, David Gallo's Valinor Management LLC, and John Overdeck and David Siegel's Two Sigma Advisors.
Insider buying is at its handiest when the company in question has experienced transactions within the past 180 days. Over the last half-year time period, Francesca's Holdings Corp (NASDAQ:FRAN) has seen 4 unique insiders buying, and zero insider sales (see the details of insider trades here).
With the returns demonstrated by Insider Monkey's time-tested strategies, everyday investors must always keep an eye on hedge fund and insider trading sentiment, and Francesca's Holdings Corp (NASDAQ:FRAN) is an important part of this process.
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