Is Penn National Gaming, Inc (NASDAQ:PENN) a buy?
In today’s marketplace, there are plenty of gauges investors can use to watch their holdings. Some of the most useful are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best fund managers can outpace the S&P 500 by a healthy margin (see just how much).
Equally as necessary, optimistic insider trading sentiment is a second way to analyze the investments you're interested in. Obviously, there are lots of incentives for a corporate insider to drop shares of his or her company, but just one, very clear reason why they would buy. Several academic studies have demonstrated the market-beating potential of this tactic if piggybackers understand what to do (learn more here).
Now that that's out of the way, it's important to analyze the newest info surrounding Penn National Gaming, Inc (NASDAQ:PENN).
At the end of the second quarter, a total of 36 of the hedge funds we track were bullish in this stock, a change of 16% from the first quarter. With hedge funds' sentiment swirling, there exists a few key hedge fund managers who were upping their stakes considerably.
When using filings from the hedgies we track, Natixis Global Asset Management's Harris Associates had the most valuable position in Penn National Gaming, Inc (NASDAQ:PENN), worth close to $236.9 million, comprising 0.5% of its total 13F portfolio. The second largest stake is held by PAR Capital Management, managed by Paul Reeder and Edward Shapiro, which held a $185.2 million position; the fund has 5.2% of its 13F portfolio invested in the stock. Remaining hedgies with similar optimism include Dmitry Balyasny's Balyasny Asset Management, Rob Butts and Josh Clark's Southpoint Capital Advisors and Frank Brosens's Taconic Capital.
With a general bullishness amongst the titans, particular hedge funds have been driving this bullishness. PAR Capital Management, managed by Paul Reeder and Edward Shapiro, created the largest position in Penn National Gaming, Inc (NASDAQ:PENN). PAR Capital Management had 185.2 million invested in the company at the end of the quarter. Dmitry Balyasny's Balyasny Asset Management also made a $141.4 million investment in the stock during the quarter. The other funds with brand new PENN positions are Rob Butts and Josh Clark's Southpoint Capital Advisors, Frank Brosens's Taconic Capital, and Michael A. Price and Amos Meron's Empyrean Capital Partners.
Insider buying made by high-level executives is most useful when the company in question has seen transactions within the past six months. Over the latest 180-day time frame, Penn National Gaming, Inc (NASDAQ:PENN) has seen zero unique insiders purchasing, and 7 insider sales (see the details of insider trades here).
We'll check out the relationship between both of these indicators in other stocks similar to Penn National Gaming, Inc (NASDAQ:PENN). These stocks are Marriott Vacations Worldwide Corp (NYSE:VAC), Caesars Entertainment Corp (NASDAQ:CZR), Vail Resorts, Inc. (NYSE:MTN), Royal Caribbean Cruises Ltd. (NYSE:RCL), and MGM Resorts International (NYSE:MGM). This group of stocks are in the resorts & casinos industry and their market caps match PENN's market cap.