What’s a smart Burger King Worldwide Inc (NYSE:BKW) investor to do?
If you were to ask many market players, hedge funds are viewed as useless, old financial tools of a period lost to current times. Although there are over 8,000 hedge funds in operation in present day, Insider Monkey focuses on the leaders of this club, around 525 funds. It is assumed that this group has its hands on the lion’s share of the smart money’s total assets, and by paying attention to their highest quality stock picks, we’ve unearthed a few investment strategies that have historically outpaced the S&P 500. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points per annum for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have outclassed the S&P 500 index by 33 percentage points in 11 months (see all of our picks from August).
Equally as crucial, positive insider trading sentiment is a second way to look at the world of equities. As the old adage goes: there are plenty of reasons for a corporate insider to drop shares of his or her company, but just one, very clear reason why they would initiate a purchase. Several academic studies have demonstrated the market-beating potential of this tactic if “monkeys” understand where to look (learn more here).
What’s more, we’re going to discuss the latest info for Burger King Worldwide Inc (NYSE:BKW).
How have hedgies been trading Burger King Worldwide Inc (NYSE:BKW)?
In preparation for the third quarter, a total of 14 of the hedge funds we track were long in this stock, a change of -7% from the previous quarter. With hedgies’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were upping their holdings substantially.
According to our 13F database, Bill Ackman’s Pershing Square had the most valuable position in Burger King Worldwide Inc (NYSE:BKW), worth close to $748.6 million, accounting for 6.8% of its total 13F portfolio. Coming in second is Chase Coleman and Feroz Dewan of Tiger Global Management LLC, with a $140.5 million position; 2.4% of its 13F portfolio is allocated to the stock. Other hedgies that hold long positions include J Kevin Kenny Jr’s Emerging Sovereign Group, David Simon’s Twin Capital Management and Murray Stahl’s Horizon Asset Management.
Since Burger King Worldwide Inc (NYSE:BKW) has witnessed dropping sentiment from the top-tier hedge fund industry, we can see that there lies a certain “tier” of hedgies that decided to sell off their full holdings heading into Q2. Intriguingly, Brian J. Higgins’s King Street Capital sold off the biggest investment of all the hedgies we key on, totaling an estimated $13.9 million in stock, and Chuck Royce of Royce & Associates was right behind this move, as the fund dropped about $0.7 million worth. These bearish behaviors are intriguing to say the least, as total hedge fund interest fell by 1 funds heading into Q2.
What have insiders been doing with Burger King Worldwide Inc (NYSE:BKW)?
Insider buying is most useful when the company we’re looking at has seen transactions within the past 180 days. Over the latest six-month time frame, Burger King Worldwide Inc (NYSE:BKW) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We’ll also review the relationship between both of these indicators in other stocks similar to Burger King Worldwide Inc (NYSE:BKW). These stocks are Domino’s Pizza, Inc. (NYSE:DPZ), Dunkin Brands Group Inc (NASDAQ:DNKN), Chipotle Mexican Grill, Inc. (NYSE:CMG), Tim Hortons Inc. (USA) (NYSE:THI), and Darden Restaurants, Inc. (NYSE:DRI). This group of stocks are the members of the restaurants industry and their market caps are closest to BKW’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Domino’s Pizza, Inc. (NYSE:DPZ)||25||0||0|
|Dunkin Brands Group Inc (NASDAQ:DNKN)||18||0||0|
|Chipotle Mexican Grill, Inc. (NYSE:CMG)||28||0||0|
|Tim Hortons Inc. (USA) (NYSE:THI)||23||0||0|
|Darden Restaurants, Inc. (NYSE:DRI)||21||0||0|
Using the results demonstrated by the previously mentioned strategies, regular investors must always keep one eye on hedge fund and insider trading sentiment, and Burger King Worldwide Inc (NYSE:BKW) applies perfectly to this mantra.