The Coca-Cola Company (NYSE:KO) hasn’t had an amazing 2013, but it’s a stalwart, as simple as that. As long as hedge fund AUMs stay in the billions, a mega-cap with solid appreciation and dividends will be a money manager’s best friend. Let’s see how the hedgies were treating it last quarter.
At the moment, there are many methods shareholders can use to monitor their holdings. A duo of the best are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite hedge fund managers can outclass the broader indices by a significant amount (see just how much).
Just as key, positive insider trading sentiment is another way to analyze the marketplace. Just as you’d expect, there are many stimuli for an upper level exec to sell shares of his or her company, but only one, very simple reason why they would initiate a purchase. Several empirical studies have demonstrated the useful potential of this strategy if investors understand where to look (learn more here).
Furthermore, it’s important to analyze the newest info for The Coca-Cola Company (NYSE:KO).
What does the smart money think about The Coca-Cola Company (NYSE:KO)?
In preparation for the third quarter, a total of 56 of the hedge funds we track were bullish in this stock, a change of -5% from the first quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were increasing their holdings meaningfully.
As The Coca-Cola Company (NYSE:KO) has witnessed bearish sentiment from the entirety of the hedge funds we track, it’s safe to say that there is a sect of money managers that slashed their positions entirely at the end of the second quarter. At the top of the heap, Andrew Sandler’s Sandler Capital Management said goodbye to the biggest position of the 450+ funds we track, comprising close to $16.2 million in stock. Larry Foley and Paul Farrell’s fund, Bronson Point Partners, also said goodbye to its stock, about $15.4 million worth. These transactions are important to note, as total hedge fund interest dropped by 3 funds at the end of the second quarter.
What have insiders been doing with The Coca-Cola Company (NYSE:KO)?
Legal insider trading, particularly when it’s bullish, is best served when the company in focus has seen transactions within the past half-year. Over the latest half-year time frame, The Coca-Cola Company (NYSE:KO) has experienced 1 unique insiders buying, and 11 insider sales (see the details of insider trades here).
We’ll check out the relationship between both of these indicators in other stocks similar to The Coca-Cola Company (NYSE:KO). These stocks are Dr Pepper Snapple Group Inc. (NYSE:DPS), Coca-Cola HBC S.A. (ADR) (NYSE:CCH), Coca-Cola Enterprises Inc (NYSE:CCE), Coca-Cola FEMSA, S.A.B. de C.V. (ADR) (NYSE:KOF), and PepsiCo, Inc. (NYSE:PEP). This group of stocks are in the beverages – soft drinks industry and their market caps resemble KO’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Dr Pepper Snapple Group Inc. (NYSE:DPS) | 22 | 1 | 9 |
| Coca-Cola HBC S.A. (ADR) (NYSE:CCH) | 0 | 0 | |
| Coca-Cola Enterprises Inc (NYSE:CCE) | 31 | 0 | 6 |
| Coca-Cola FEMSA, S.A.B. de C.V. (ADR) (NYSE:KOF) | 12 | 0 | 0 |
| PepsiCo, Inc. (NYSE:PEP) | 46 | 1 | 11 |
Using the returns demonstrated by the previously mentioned analyses, regular investors must always watch hedge fund and insider trading sentiment, and The Coca-Cola Company (NYSE:KO) applies perfectly to this mantra.
