Is it smart to buy Starwood Hotels & Resorts Worldwide, Inc (NYSE:HOT)?
In today’s marketplace, there are plenty of indicators market participants can use to analyze stocks. A pair of the most under-the-radar are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the best money managers can trounce their index-focused peers by a healthy amount (see just how much).
Equally as key, positive insider trading activity is another way to analyze the financial markets. As the old adage goes: there are a number of reasons for a bullish insider to drop shares of his or her company, but only one, very obvious reason why they would buy. Many academic studies have demonstrated the market-beating potential of this method if investors understand where to look (learn more here).
Now that that’s out of the way, it’s important to examine the latest info about Starwood Hotels & Resorts Worldwide, Inc (NYSE:HOT).
How have hedgies been trading Starwood Hotels & Resorts Worldwide, Inc (NYSE:HOT)?
Heading into Q3, a total of 39 of the hedge funds we track were bullish in this stock, a change of 3% from the previous quarter. With the smart money’s sentiment swirling, there exists a select group of key hedge fund managers who were upping their holdings significantly.
When using filings from the hedgies we track, Harris Associates, managed by Natixis Global Asset Management, holds the biggest position in Starwood Hotels & Resorts Worldwide, Inc (NYSE:HOT). Harris Associates has a $472.8 million position in the stock, comprising 1% of its 13F portfolio. On Harris Associates’s heels is Partner Fund Management, managed by Christopher Medlock James, which held a $144.1 million position; 3% of its 13F portfolio is allocated to the stock. Some other peers that are bullish include Patrick McCormack’s Tiger Consumer Management, and Clint Carlson’s Carlson Capital.
As one would understandably expect, particular hedge funds have been driving this bullishness. Partner Fund Management, managed by Christopher Medlock▀James, assembled the most outsized position in Starwood Hotels & Resorts Worldwide, Inc (NYSE:HOT). Partner Fund Management had 144.1 million invested in the company at the end of the quarter. Patrick McCormack’s Tiger Consumer Management also initiated a $76.6 million position during the quarter. The other funds with brand new HOT positions are Mark T. Gallogly’s Centerbridge Partners, Clint Carlson’s Carlson Capital, and Jeffrey Furber’s AEW Capital Management.
How are insiders trading Starwood Hotels & Resorts Worldwide, Inc (NYSE:HOT)?
Insider buying made by high-level executives is best served when the company in focus has experienced transactions within the past six months. Over the latest six-month time frame, Starwood Hotels & Resorts Worldwide, Inc (NYSE:HOT) has experienced 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 Starwood Hotels & Resorts Worldwide, Inc (NYSE:HOT). These stocks are Hyatt Hotels Corporation (NYSE:H), Expedia Inc (NASDAQ:EXPE), InterContinental Hotels Group PLC (ADR) (NYSE:IHG), Wyndham Worldwide Corporation (NYSE:WYN), and Marriott International Inc (NYSE:MAR). This group of stocks are in the lodging industry and their market caps match HOT’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Hyatt Hotels Corporation (NYSE:H) | 12 | 0 | 2 |
| Expedia Inc (NASDAQ:EXPE) | 43 | 1 | 1 |
| InterContinental Hotels Group PLC (ADR) (NYSE:IHG) | 12 | 0 | 0 |
| Wyndham Worldwide Corporation (NYSE:WYN) | 38 | 0 | 6 |
| Marriott International Inc (NYSE:MAR) | 32 | 0 | 9 |
Using the returns shown by the previously mentioned analyses, average investors should always track hedge fund and insider trading sentiment, and Starwood Hotels & Resorts Worldwide, Inc (NYSE:HOT) applies perfectly to this mantra.
