Darden Restaurants, Inc. (NYSE:DRI) was in 18 hedge funds' portfolio at the end of December. DRI has experienced an increase in hedge fund sentiment in recent months. There were 10 hedge funds in our database with DRI holdings at the end of the previous quarter.
To the average investor, there are dozens of methods shareholders can use to watch their holdings. A duo of the most useful are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the best money managers can outperform the S&P 500 by a healthy amount (see just how much).
Equally as key, positive insider trading activity is a second way to parse down the investments you're interested in. As the old adage goes: there are a number of incentives for a bullish insider to get rid of shares of his or her company, but only one, very clear reason why they would initiate a purchase. Many academic studies have demonstrated the valuable potential of this strategy if investors know where to look (learn more here).
Now, let's take a look at the key action regarding Darden Restaurants, Inc. (NYSE:DRI).
At the end of the fourth quarter, a total of 18 of the hedge funds we track held long positions in this stock, a change of 80% from one quarter earlier. With the smart money's positions undergoing their usual ebb and flow, there exists an "upper tier" of notable hedge fund managers who were increasing their stakes significantly.
When looking at the hedgies we track, Renaissance Technologies, managed by Jim Simons, holds the most valuable position in Darden Restaurants, Inc. (NYSE:DRI). Renaissance Technologies has a $26 million position in the stock, comprising 0.1% of its 13F portfolio. Sitting at the No. 2 spot is Ken Griffin of Citadel Investment Group, with a $11 million position; 0% of its 13F portfolio is allocated to the stock. Other peers that hold long positions include Phill Gross and Robert Atchinson's Adage Capital Management, and Israel Englander's Millennium Management.
As industrywide interest jumped, key hedge funds were leading the bulls' herd. Millennium Management, managed by Israel Englander, established the largest position in Darden Restaurants, Inc. (NYSE:DRI). Millennium Management had 5 million invested in the company at the end of the quarter. Neil Chriss's Hutchin Hill Capital also initiated a $3 million position during the quarter. The other funds with brand new DRI positions are Peter Rathjens, Bruce Clarke and John Campbell's Arrowstreet Capital, Glenn Russell Dubin's Highbridge Capital Management, and Steven Cohen's SAC Capital Advisors.
Insider trading activity, especially when it's bullish, is most useful when the primary stock in question has experienced transactions within the past 180 days. Over the last half-year time frame, Darden Restaurants, Inc. (NYSE:DRI) has seen 1 unique insiders buying, and 6 insider sales (see the details of insider trades here).
With the results exhibited by Insider Monkey's time-tested strategies, retail investors should always keep an eye on hedge fund and insider trading sentiment, and Darden Restaurants, Inc. (NYSE:DRI) is no exception.
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