Is Francesca’s Holdings Corp (NASDAQ:FRAN) the right pick for your portfolio? Investors who are in the know are becoming hopeful. The number of bullish hedge fund bets advanced by 3 recently.
To most investors, hedge funds are seen as worthless, outdated investment tools of the past. While there are greater than 8000 funds in operation today, we at Insider Monkey choose to focus on the leaders of this club, close to 450 funds. It is widely believed that this group has its hands on the lion’s share of all hedge funds’ total asset base, and by monitoring their top stock picks, we have found a number of investment strategies that have historically outstripped the market. 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 beaten the S&P 500 index by 23.3 percentage points in 8 months (check out a sample of our picks).
Equally as integral, bullish insider trading sentiment is a second way to parse down the world of equities. Just as you’d expect, there are many motivations for an executive to sell shares of his or her company, but just one, very obvious reason why they would buy. Many academic studies have demonstrated the impressive potential of this tactic if you understand what to do (learn more here).
With all of this in mind, we’re going to take a glance at the latest action encompassing Francesca’s Holdings Corp (NASDAQ:FRAN).
Hedge fund activity in Francesca’s Holdings Corp (NASDAQ:FRAN)
Heading into Q2, a total of 27 of the hedge funds we track held long positions in this stock, a change of 13% from one quarter earlier. With hedge funds’ capital changing hands, there exists an “upper tier” of key hedge fund managers who were upping their holdings meaningfully.
When looking at the hedgies we track, Daruma Asset Management, managed by Mariko Gordon, holds the biggest position in Francesca’s Holdings Corp (NASDAQ:FRAN). Daruma Asset Management has a $66.7 million position in the stock, comprising 3.4% of its 13F portfolio. Sitting at the No. 2 spot is Phill Gross and Robert Atchinson of Adage Capital Management, with a $51.1 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Remaining hedge funds that hold long positions include David Keidan’s Buckingham Capital Management, Ken Griffin’s Citadel Investment Group and Eric Chen’s Antipodean Advisors.
Consequently, some big names were leading the bulls’ herd. Buckingham Capital Management, managed by David Keidan, initiated the most outsized position in Francesca’s Holdings Corp (NASDAQ:FRAN). Buckingham Capital Management had 29.7 million invested in the company at the end of the quarter. Nick Niell’s Arrowgrass Capital Partners also initiated a $7.2 million position during the quarter. The other funds with brand new FRAN positions are SAC Subsidiary’s CR Intrinsic Investors, Alec Litowitz and Ross Laser’s Magnetar Capital, and George Soros’s Soros Fund Management.
Insider trading activity in Francesca’s Holdings Corp (NASDAQ:FRAN)
Insider buying is at its handiest when the company in focus has seen transactions within the past 180 days. Over the latest 180-day time frame, Francesca’s Holdings Corp (NASDAQ:FRAN) has seen 4 unique insiders buying, and 3 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Francesca’s Holdings Corp (NASDAQ:FRAN). These stocks are Coinstar, Inc. (NASDAQ:CSTR), OfficeMax Inc (NYSE:OMX), Vitamin Shoppe Inc (NYSE:VSI), Office Depot Inc (NYSE:ODP), and EZCORP Inc (NASDAQ:EZPW). All of these stocks are in the specialty retail, other industry and their market caps match FRAN’s market cap.