Dunkin Brands Group Inc (NASDAQ:DNKN) has risen more than 5% in the past week, leading more bulls to speculate on the stock, hoping that more gains are in store for the second week of April. We should point out, though, that there’s two underused indicates that show hedgies and insiders have been selling in recent months.
According to most stock holders, hedge funds are viewed as worthless, outdated financial tools of the past. While there are over 8000 funds trading today, we hone in on the aristocrats of this group, around 450 funds. It is widely believed that this group controls most of the hedge fund industry’s total asset base, and by keeping an eye on their highest performing picks, we have determined a few investment strategies that have historically beaten the broader indices (see the details here).
Equally as integral, positive insider trading activity is a second way to break down the financial markets. There are many motivations for an executive to drop shares of his or her company, but just one, very simple reason why they would buy (learn more here).
Let’s take a peek at the recent action regarding Dunkin Brands Group Inc (NASDAQ:DNKN).
A total of 20 of the hedge funds we track were long in this stock heading into 2013, a change of -33% from the third quarter. With the smart money’s capital changing hands, there exists a few noteworthy hedge fund managers who were upping their holdings meaningfully.
When looking at the hedgies we track, Tremblant Capital, managed by Brett Barakett, holds the largest position in Dunkin Brands Group Inc (NASDAQ:DNKN). Tremblant Capital has a $79 million position in the stock, comprising 3.6% of its 13F portfolio.
On Tremblant Capital’s heels is Rob Citrone of Discovery Capital Management, with a $49 million position; the fund has 0.7% of its 13F portfolio invested in the stock. Other peers that hold long positions include Panayotis æTakisÆ Sparaggis’s Alkeon Capital Management, Doug Silverman’s Senator Investment Group and Ken Griffin’s Citadel Investment Group. Moreover, Stephen Mandel’s Lone Pine Capital sold off the largest investment of the 450+ funds we key on, comprising an estimated $211 million in stock.
Let’s also examine hedge fund and insider activity in other stocks similar to Dunkin Brands Group Inc (NASDAQ:DNKN), and Dunkin itself. These stocks are Burger King Worldwide Inc (NYSE:BKW), Darden Restaurants, Inc. (NYSE:DRI), Brinker International, Inc. (NYSE:EAT), Arcos Dorados Holding Inc (NYSE:ARCO), and Domino’s Pizza, Inc. (NYSE:DPZ). All of these stocks are in the restaurants industry and their market caps are closest to DNKN’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Burger King Worldwide Inc (NYSE:BKW)||10||0||0|
|Darden Restaurants, Inc. (NYSE:DRI)||18||1||3|
|Brinker International, Inc. (NYSE:EAT)||17||1||5|
|Arcos Dorados Holding Inc (NYSE:ARCO)||9||0||0|
|Domino’s Pizza, Inc. (NYSE:DPZ)||20||0||1|
How were insiders trading Dunkin?