Is Chipotle Mexican Grill, Inc. (NYSE:CMG) a buy?
In the 21st century investor’s toolkit, there are tons of gauges market participants can use to analyze stocks. A pair of the most underrated are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top hedge fund managers can trounce the S&P 500 by a healthy margin (see just how much).
Just as key, optimistic insider trading sentiment is another way to look at the world of equities. As the old adage goes: there are lots of reasons for an executive to drop shares of his or her company, but just one, very simple reason why they would initiate a purchase. Many empirical studies have demonstrated the useful potential of this method if shareholders know where to look (learn more here).
Furthermore, let’s examine the recent info for Chipotle Mexican Grill, Inc. (NYSE:CMG).
Hedge fund activity in Chipotle Mexican Grill, Inc. (NYSE:CMG)
At the end of the second quarter, a total of 28 of the hedge funds we track were long in this stock, a change of 12% from the previous quarter. With the smart money’s capital changing hands, there exists a select group of key hedge fund managers who were increasing their holdings substantially.
As aggregate interest spiked, certain money managers were breaking ground themselves. SAC Capital Advisors, managed by Steven Cohen, assembled the biggest position in Chipotle Mexican Grill, Inc. (NYSE:CMG). SAC Capital Advisors had 116.7 million invested in the company at the end of the quarter. Ken Griffin’s Citadel Investment Group also initiated a $106.9 million position during the quarter. The following funds were also among the new CMG investors: Panayotis æTakisÆ Sparaggis’s Alkeon Capital Management, Ken Griffin’s Citadel Investment Group, and Israel Englander’s Millennium Management.
What have insiders been doing with Chipotle Mexican Grill, Inc. (NYSE:CMG)?
Insider buying made by high-level executives is at its handiest when the primary stock in question has seen transactions within the past six months. Over the last half-year time period, Chipotle Mexican Grill, Inc. (NYSE:CMG) has seen 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 Chipotle Mexican Grill, Inc. (NYSE:CMG). These stocks are Yum! Brands, Inc. (NYSE:YUM), Dunkin Brands Group Inc (NASDAQ:DNKN), Darden Restaurants, Inc. (NYSE:DRI), Burger King Worldwide Inc (NYSE:BKW), and Tim Hortons Inc. (USA) (NYSE:THI). This group of stocks are the members of the restaurants industry and their market caps are closest to CMG’s market cap.