The Kroger Co. (NYSE:KR) was in 23 hedge funds’ portfolio at the end of the first quarter of 2013. KR investors should pay attention to an increase in hedge fund interest of late. There were 21 hedge funds in our database with KR positions at the end of the previous quarter.
To the average investor, there are tons of indicators market participants can use to monitor their holdings. Some 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 top money managers can outperform the S&P 500 by a very impressive amount (see just how much).
Equally as important, positive insider trading activity is another way to break down the stock market universe. Just as you’d expect, there are a variety of reasons for an executive to get rid of shares of his or her company, but just one, very simple reason why they would initiate a purchase. Various empirical studies have demonstrated the valuable potential of this tactic if you understand where to look (learn more here).
Keeping this in mind, we’re going to take a look at the latest action surrounding The Kroger Co. (NYSE:KR).
Hedge fund activity in The Kroger Co. (NYSE:KR)
At the end of the first quarter, a total of 23 of the hedge funds we track held long positions in this stock, a change of 10% from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were increasing their stakes meaningfully.
Of the funds we track, Steven Richman’s East Side Capital (RR Partners) had the biggest position in The Kroger Co. (NYSE:KR), worth close to $188 million, accounting for 9.4% of its total 13F portfolio. Sitting at the No. 2 spot is Ken Griffin of Citadel Investment Group, with a $48.8 million position; 0.1% of its 13F portfolio is allocated to the stock. Remaining hedge funds that are bullish include Cliff Asness’s AQR Capital Management, Ken Heebner’s Capital Growth Management and D. E. Shaw’s D E Shaw.
Consequently, key money managers have jumped into The Kroger Co. (NYSE:KR) headfirst. Capital Growth Management, managed by Ken Heebner, initiated the most valuable position in The Kroger Co. (NYSE:KR). Capital Growth Management had 38.1 million invested in the company at the end of the quarter. Andrew Sandler’s Sandler Capital Management also made a $22.8 million investment in the stock during the quarter. The following funds were also among the new KR investors: Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, Jim Simons’s Renaissance Technologies, and Abby Flamholz and Yehuda Blinder’s ADAR Investment Management.
Insider trading activity in The Kroger Co. (NYSE:KR)
Insider buying is at its handiest when the primary stock in question has seen transactions within the past 180 days. Over the latest 180-day time frame, The Kroger Co. (NYSE:KR) has experienced zero unique insiders purchasing, and 14 insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to The Kroger Co. (NYSE:KR). These stocks are Casey’s General Stores, Inc. (NASDAQ:CASY), Delhaize Group (ADR) (NYSE:DEG), Safeway Inc. (NYSE:SWY), Companhia Brasileira de Distrib. (ADR) (NYSE:CBD), and Whole Foods Market, Inc. (NASDAQ:WFM). All of these stocks are in the grocery stores industry and their market caps are closest to KR’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Casey’s General Stores, Inc. (NASDAQ:CASY)||11||0||3|
|Delhaize Group (ADR) (NYSE:DEG)||6||0||0|
|Safeway Inc. (NYSE:SWY)||28||0||2|
|Companhia Brasileira de Distrib. (ADR) (NYSE:CBD)||14||0||0|
|Whole Foods Market, Inc. (NASDAQ:WFM)||39||1||24|
With the returns exhibited by Insider Monkey’s tactics, retail investors should always watch hedge fund and insider trading sentiment, and The Kroger Co. (NYSE:KR) applies perfectly to this mantra.