Is McDonald’s Corporation (MCD) Going to Burn These Hedge Funds?

Page 1 of 2

McDonald’s Corporation (NYSE:MCD) investors should be aware of a decrease in enthusiasm from smart money in recent months.

According to most stock holders, hedge funds are assumed to be unimportant, outdated financial vehicles of the past. While there are over 8000 funds in operation at the moment, we at Insider Monkey look at the crème de la crème of this club, around 450 funds. It is widely believed that this group has its hands on the lion’s share of the smart money’s total capital, and by monitoring their top equity investments, we have revealed a few investment strategies that have historically outstripped the S&P 500 index. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points per 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 23.3 percentage points in 8 months (see all of our picks from August).

McDonald's Corporation (NYSE:MCD)

Equally as key, optimistic insider trading activity is a second way to parse down the financial markets. As the old adage goes: there are lots of reasons for an insider to drop shares of his or her company, but just one, very simple reason why they would initiate a purchase. Various empirical studies have demonstrated the market-beating potential of this tactic if investors know where to look (learn more here).

With these “truths” under our belt, it’s important to take a peek at the recent action encompassing McDonald’s Corporation (NYSE:MCD).

How have hedgies been trading McDonald’s Corporation (NYSE:MCD)?

Heading into Q2, a total of 43 of the hedge funds we track were long in this stock, a change of -12% from the first quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were upping their holdings significantly.

According to our comprehensive database, Michael Larson’s Bill & Melinda Gates Foundation Trust had the biggest position in McDonald’s Corporation (NYSE:MCD), worth close to $984.2 million, comprising 5.4% of its total 13F portfolio. Coming in second is Fisher Asset Management, managed by Ken Fisher, which held a $518.8 million position; the fund has 1.4% of its 13F portfolio invested in the stock. Other hedge funds with similar optimism include Jim Simons’s Renaissance Technologies, Ken Griffin’s Citadel Investment Group and Ric Dillon’s Diamond Hill Capital.

Since McDonald’s Corporation (NYSE:MCD) has experienced a declination in interest from the entirety of the hedge funds we track, logic holds that there lies a certain “tier” of hedge funds that elected to cut their entire stakes heading into Q2. It’s worth mentioning that Daniel S. Och’s OZ Management dumped the largest stake of the 450+ funds we watch, worth close to $32 million in stock.. John A. Levin’s fund, Levin Capital Strategies, also dropped its stock, about $23 million worth. These transactions are interesting, as total hedge fund interest dropped by 6 funds heading into Q2.

What have insiders been doing with McDonald’s Corporation (NYSE:MCD)?

Bullish insider trading is most useful when the company in question has seen transactions within the past 180 days. Over the last half-year time period, McDonald’s Corporation (NYSE:MCD) has experienced 1 unique insiders buying, and 9 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to McDonald’s Corporation (NYSE:MCD). These stocks are Darden Restaurants, Inc. (NYSE:DRI), Burger King Worldwide Inc (NYSE:BKW), Tim Hortons Inc. (USA) (NYSE:THI), Chipotle Mexican Grill, Inc. (NYSE:CMG), and Yum! Brands, Inc. (NYSE:YUM). All of these stocks are in the restaurants industry and their market caps resemble MCD’s market cap.

Page 1 of 2
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Largest Pharmaceutical Companies In the World

The 10 Most Expensive Android Apps

The 9 Most Expensive Designer Bags in the World

The 7 Most Expensive Real Estate in the World

The 10 Most Expensive eBay Items Ever Sold

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!