This Dollar Tree, Inc. (DLTR) Data Is Telling You To Buy. Now.
Dollar Tree, Inc. (NASDAQ:DLTR) is one of the most popular stocks for investors betting on consumers' continued love of discounts, even in relatively good economic times. In a philosophical way, this is a play that the latest financial crisis permanently changed the consumer culture in the U.S.; hedge funds are on board.
If you were to ask many market players, hedge funds are assumed to be useless, outdated financial vehicles of a period lost to current times. Although there are In excess of 8,000 hedge funds in operation currently, this site focuses on the upper echelon of this club, close to 525 funds. Analysts calculate that this group controls most of the smart money's total assets, and by paying attention to their highest performing stock picks, we've come up with a number of investment strategies that have historically outstripped the market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points per year for a decade in our back tests, and since we've started sharing our picks with our subscribers at the end of August 2012, we have trumped the S&P 500 index by 33 percentage points in 11 months (find the details here).
Equally as key, bullish insider trading sentiment is a second way to analyze the stock market universe. Obviously, there are many stimuli for an upper level exec to drop shares of his or her company, but just one, very obvious reason why they would behave bullishly. Various empirical studies have demonstrated the market-beating potential of this strategy if piggybackers understand where to look (learn more here).
Thus, it's important to study the latest info for Dollar Tree, Inc. (NASDAQ:DLTR).
What have hedge funds been doing with Dollar Tree, Inc. (NASDAQ:DLTR)?
At Q2's end, a total of 44 of the hedge funds we track were long in this stock, a change of 10% 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.
Out of the hedge funds we follow, Lone Pine Capital, managed by Stephen Mandel, holds the largest position in Dollar Tree, Inc. (NASDAQ:DLTR). Lone Pine Capital has a $409.4 million position in the stock, comprising 2% of its 13F portfolio. Coming in second is Eric Mindich of Eton Park Capital, with a $292.3 million position; the fund has 5.6% of its 13F portfolio invested in the stock. Some other hedge funds that are bullish include John Griffin's Blue Ridge Capital, Jason Capello's Merchants' Gate Capital and Charles Akre's Akre Capital Management.
As aggregate interest spiked, particular hedge funds have jumped into Dollar Tree, Inc. (NASDAQ:DLTR) headfirst. Lone Pine Capital, managed by Stephen Mandel, established the largest position in Dollar Tree, Inc. (NASDAQ:DLTR). Lone Pine Capital had 409.4 million invested in the company at the end of the quarter. Eric Mindich's Eton Park Capital also initiated a $292.3 million position during the quarter. The following funds were also among the new DLTR investors: John Griffin's Blue Ridge Capital, Jason Capello's Merchants' Gate Capital, and Charles Akre's Akre Capital Management.
Insider trading activity in Dollar Tree, Inc. (NASDAQ:DLTR)
Insider buying is particularly usable when the company we're looking at has seen transactions within the past half-year. Over the last 180-day time period, Dollar Tree, Inc. (NASDAQ:DLTR) has seen 1 unique insiders purchasing, and 4 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 Dollar Tree, Inc. (NASDAQ:DLTR). These stocks are PriceSmart, Inc. (NASDAQ:PSMT), Costco Wholesale Corporation (NASDAQ:COST), Target Corporation (NYSE:TGT), Family Dollar Stores, Inc. (NYSE:FDO), and Dollar General Corp. (NYSE:DG). This group of stocks belong to the discount, variety stores industry and their market caps resemble DLTR's market cap.
# of Hedge Funds
# of Insiders Buying
# of Insiders Selling
PriceSmart, Inc. (NASDAQ:PSMT)
Costco Wholesale Corporation (NASDAQ:COST)
Target Corporation (NYSE:TGT)
Family Dollar Stores, Inc. (NYSE:FDO)
Dollar General Corp. (NYSE:DG)
Using the returns shown by the previously mentioned research, regular investors should always keep one eye on hedge fund and insider trading sentiment, and Dollar Tree, Inc. (NASDAQ:DLTR) shareholders fit into this picture quite nicely.