Krispy Kreme Doughnuts (NYSE:KKD): Hedge Funds and Insiders Are Bearish, What Should You Do?

Krispy Kreme Doughnuts (NYSE:KKD) shareholders have witnessed a decrease in hedge fund sentiment recently.

To the average investor, there are many gauges market participants can use to analyze Mr. Market. A duo of the most innovative are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top fund managers can outpace the market by a very impressive amount (see just how much).

Krispy Kreme Doughnuts (NYSE:KKD)Just as beneficial, optimistic insider trading sentiment is another way to parse down the marketplace. There are a variety of incentives for a corporate insider to sell shares of his or her company, but just one, very clear reason why they would behave bullishly. Many academic studies have demonstrated the market-beating potential of this strategy if you know what to do (learn more here).

Now, it’s important to take a peek at the key action surrounding Krispy Kreme Doughnuts (NYSE:KKD).

Hedge fund activity in Krispy Kreme Doughnuts (NYSE:KKD)

At the end of the fourth quarter, a total of 19 of the hedge funds we track held long positions in this stock, a change of 0% from the previous quarter. With hedge funds’ capital changing hands, there exists a few noteworthy hedge fund managers who were boosting their holdings substantially.

Of the funds we track, Chuck Royce’s Royce & Associates had the largest position in Krispy Kreme Doughnuts (NYSE:KKD), worth close to $9 million, comprising 0% of its total 13F portfolio. The second largest stake is held by Richard Driehaus of Driehaus Capital, with a $6 million position; 0% of its 13F portfolio is allocated to the stock. Remaining hedge funds with similar optimism include Amy Minella’s Cardinal Capital, Ken Griffin’s Citadel Investment Group and Jim Simons’s Renaissance Technologies.

Due to the fact that Krispy Kreme Doughnuts (NYSE:KKD) has faced bearish sentiment from hedge fund managers, we can see that there was a specific group of funds that decided to sell off their full holdings last quarter. It’s worth mentioning that Richard S. Meisenberg’s ACK Asset Management dumped the biggest investment of the 450+ funds we key on, worth about $4 million in stock. J. Carlo Cannell’s fund, Cannell Capital, also said goodbye to its stock, about $3 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

How are insiders trading Krispy Kreme Doughnuts (NYSE:KKD)?

Bullish insider trading is most useful when the company in question has experienced transactions within the past half-year. Over the last six-month time frame, Krispy Kreme Doughnuts (NYSE:KKD) has seen zero unique insiders buying, and 2 insider sales (see the details of insider trades here).

With the results shown by our time-tested strategies, everyday investors must always pay attention to hedge fund and insider trading activity, and Krispy Kreme Doughnuts (NYSE:KKD) shareholders fit into this picture quite nicely.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.

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 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

The 10 Most Peaceful Countries in the World

5 Big Reasons Communism Failed

The 15 Most Famous Carl Icahn Quotes

10 Scary Animals that are Actually Harmless

The 8 Most Famous Singer-Actors in Entertainment

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!