Is Fiesta Restaurant Group Inc (FRGI) Going to Burn These Hedge Funds?

We at Insider Monkey have gone over 700 13F filings that hedge funds and prominent investors are required to file by the government. The 13F filings show the funds’ and investors’ portfolio positions as of September 30. In this article we look at what those investors think of Fiesta Restaurant Group Inc (NASDAQ:FRGI).

Fiesta Restaurant Group Inc (NASDAQ:FRGI) shareholders have witnessed an increase in hedge fund interest recently. FRGI was in 18 hedge funds’ portfolios at the end of the third quarter of 2015. There were 17 hedge funds in our database with FRGI holdings at the end of the previous quarter. At the end of this article we will also compare FRGI to other stocks, including SAGE Therapeutics Inc (NASDAQ:SAGE), Itron, Inc. (NASDAQ:ITRI), and ExlService Holdings, Inc. (NASDAQ:EXLS) to get a better sense of its popularity.

To the average investor there are a lot of formulas stock market investors put to use to grade their holdings. A duo of the most innovative formulas are hedge fund and insider trading signals. Our experts have shown that, historically, those who follow the best picks of the elite investment managers can outperform the broader indices by a significant margin (see the details here).

With all of this in mind, let’s view the fresh action regarding Fiesta Restaurant Group Inc (NASDAQ:FRGI).

Hedge fund activity in Fiesta Restaurant Group Inc (NASDAQ:FRGI)

At the Q3’s end, a total of 18 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from one quarter earlier. With hedge funds’ positions undergoing their usual ebb and flow, there exists a select group of key hedge fund managers who were boosting their stakes significantly (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Gregg J. Powers’ Private Capital Management has the biggest position in Fiesta Restaurant Group Inc (NASDAQ:FRGI), worth close to $9.6 million, comprising 1.1% of its total 13F portfolio. Coming in second is George McCabe’s Portolan Capital Management, with a $6.9 million position; the fund has 0.9% of its 13F portfolio invested in the stock. Other professional money managers that hold long positions contain David M. Markowitz’s Oskie Capital Management, Israel Englander’s Millennium Management and Drew Cupps’ Cupps Capital Management.

As aggregate interest increased, some big names have been driving this bullishness. Driehaus Capital, managed by Richard Driehaus, assembled the most valuable position in Fiesta Restaurant Group Inc (NASDAQ:FRGI). Driehaus Capital had $1.2 million invested in the company at the end of the quarter. Chao Ku’s Nine Chapters Capital Management also initiated a $1.1 million position during the quarter. The other funds with brand new FRGI positions are Matthew Tewksbury’s Stevens Capital Management and Benjamin A. Smith’s Laurion Capital Management.

Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Fiesta Restaurant Group Inc (NASDAQ:FRGI) but similarly valued. We will take a look at SAGE Therapeutics Inc (NASDAQ:SAGE), Itron, Inc. (NASDAQ:ITRI), ExlService Holdings, Inc. (NASDAQ:EXLS), and Oasis Petroleum Inc. (NYSE:OAS). This group of stocks’ market values resemble FRGI’s market value.

As you can see these stocks had an average of 18 hedge funds with bullish positions and the average amount invested in these stocks was $359 million, versus $41 million in FRGI’s case. Oasis Petroleum Inc. (NYSE:OAS) is the most popular stock in this table. On the other hand ExlService Holdings, Inc. (NASDAQ:EXLS) is the least popular one with only 13 bullish hedge fund positions. Fiesta Restaurant Group Inc (NASDAQ:FRGI) is not the least popular stock in this group, but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard OAS might be a better candidate to consider a long position.