Caesars Entertainment Corp (NASDAQ:CZR) was in 9 hedge funds’ portfolio at the end of the fourth quarter of 2012. CZR investors should be aware of a decrease in hedge fund sentiment in recent months. There were 14 hedge funds in our database with CZR holdings at the end of the previous quarter.
If you’d ask most traders, hedge funds are viewed as slow, old financial tools of years past. While there are over 8000 funds trading at the moment, we at Insider Monkey look at the elite of this group, close to 450 funds. It is widely believed that this group oversees the majority of all hedge funds’ total capital, and by monitoring their highest performing investments, we have spotted a few investment strategies that have historically beaten the market. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points annually 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 outperformed the S&P 500 index by 24 percentage points in 7 months (see all of our picks from August).
Equally as key, positive insider trading activity is another way to parse down the world of equities. There are lots of incentives for an upper level exec to cut shares of his or her company, but just one, very simple reason why they would buy. Various empirical studies have demonstrated the market-beating potential of this method if shareholders know where to look (learn more here).
With these “truths” under our belt, we’re going to take a peek at the key action surrounding Caesars Entertainment Corp (NASDAQ:CZR).
What does the smart money think about Caesars Entertainment Corp (NASDAQ:CZR)?
At year’s end, a total of 9 of the hedge funds we track were long in this stock, a change of -36% from the third quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings considerably.
When looking at the hedgies we track, John Paulson’s Paulson & Co had the most valuable position in Caesars Entertainment Corp (NASDAQ:CZR), worth close to $85.6 million, accounting for 0.5% of its total 13F portfolio. Sitting at the No. 2 spot is Soros Fund Management, managed by George Soros, which held a $18.5 million position; the fund has 0.2% of its 13F portfolio invested in the stock. Remaining hedgies that hold long positions include Howard Marks’s Oaktree Capital Management, Joshua Friedman and Mitchell Julis’s Canyon Capital Advisors and Curtis Schenker and Craig Effron’s Scoggin.
Judging by the fact that Caesars Entertainment Corp (NASDAQ:CZR) has faced falling interest from hedge fund managers, it’s safe to say that there is a sect of hedge funds that decided to sell off their positions entirely in Q4. It’s worth mentioning that Steven Tananbaum’s GoldenTree Asset Management cut the largest position of all the hedgies we key on, totaling an estimated $4.7 million in stock.. Carl Tiedemann and Michael Tiedemann’s fund, TIG Advisors, also said goodbye to its stock, about $0.7 million worth. These bearish behaviors are important to note, as total hedge fund interest dropped by 5 funds in Q4.
What have insiders been doing with Caesars Entertainment Corp (NASDAQ:CZR)?
Bullish insider trading is most useful when the company in focus has seen transactions within the past six months. Over the last six-month time frame, Caesars Entertainment Corp (NASDAQ:CZR) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to Caesars Entertainment Corp (NASDAQ:CZR). These stocks are Pinnacle Entertainment, Inc (NYSE:PNK), Ameristar Casinos, Inc. (NASDAQ:ASCA), Penn National Gaming, Inc (NASDAQ:PENN), Marriott Vacations Worldwide Corp (NYSE:VAC), and Vail Resorts, Inc. (NYSE:MTN). This group of stocks are in the resorts & casinos industry and their market caps resemble CZR’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Pinnacle Entertainment, Inc (NYSE:PNK) | 16 | 0 | 0 |
| Ameristar Casinos, Inc. (NASDAQ:ASCA) | 26 | 0 | 1 |
| Penn National Gaming, Inc (NASDAQ:PENN) | 28 | 3 | 7 |
| Marriott Vacations Worldwide Corp (NYSE:VAC) | 15 | 1 | 5 |
| Vail Resorts, Inc. (NYSE:MTN) | 11 | 0 | 0 |
With the returns exhibited by our research, everyday investors should always monitor hedge fund and insider trading sentiment, and Caesars Entertainment Corp (NASDAQ:CZR) is an important part of this process.
