Cracker Barrel Old Country Store, Inc. (CBRL): Hedge Funds and Insiders Are Bullish, What Should You Do?

Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL) was in 18 hedge funds’ portfolio at the end of the first quarter of 2013. CBRL has seen an increase in hedge fund interest recently. There were 15 hedge funds in our database with CBRL holdings at the end of the previous quarter.

To the average investor, there are dozens of methods shareholders can use to track the equity markets. A pair of the most innovative are hedge fund and insider trading activity. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best investment managers can beat the broader indices by a significant margin (see just how much).

Equally as key, optimistic insider trading activity is another way to parse down the marketplace. Obviously, there are a variety of reasons for a bullish insider to downsize shares of his or her company, but just one, very obvious reason why they would behave bullishly. Many academic studies have demonstrated the valuable potential of this method if “monkeys” understand where to look (learn more here).

With these “truths” under our belt, we’re going to take a peek at the recent action regarding Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL).

What does the smart money think about Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL)?

At Q1’s end, a total of 18 of the hedge funds we track were bullish in this stock, a change of 20% from the previous quarter. With the smart money’s capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were upping their stakes significantly.

When looking at the hedgies we track, Renaissance Technologies, managed by Jim Simons, holds the largest position in Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL). Renaissance Technologies has a $14.6 million position in the stock, comprising less than 0.1%% of its 13F portfolio. On Renaissance Technologies’s heels is Force Capital, managed by Robert Jaffe, which held a $5.1 million position; 0.5% of its 13F portfolio is allocated to the stock. Other peers with similar optimism include Ken Grossman and Glen Schneider’s SG Capital Management, Peter Algert and Kevin Coldiron’s Algert Coldiron Investors and Joel Greenblatt’s Gotham Asset Management.

As industrywide interest jumped, some big names were breaking ground themselves. SG Capital Management, managed by Ken Grossman and Glen Schneider, established the most valuable position in Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL). SG Capital Management had 3.6 million invested in the company at the end of the quarter. D. E. Shaw’s D E Shaw also made a $1.9 million investment in the stock during the quarter. The other funds with new positions in the stock are Neil Chriss’s Hutchin Hill Capital, Matthew Tewksbury’s Stevens Capital Management, and Israel Englander’s Millennium Management.

What have insiders been doing with Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL)?

Insider trading activity, especially when it’s bullish, is best served when the company in focus has experienced transactions within the past half-year. Over the latest six-month time frame, Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL) has seen 1 unique insiders purchasing, and 4 insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL). These stocks are Jack in the Box Inc. (NASDAQ:JACK), Buffalo Wild Wings (NASDAQ:BWLD), The Wendy’s Company (NASDAQ:WEN), Bloomin’ Brands Inc (NASDAQ:BLMN), and The Cheesecake Factory Incorporated (NASDAQ:CAKE). This group of stocks are the members of the restaurants industry and their market caps resemble CBRL’s market cap.

With the returns exhibited by the aforementioned tactics, retail investors should always pay attention to hedge fund and insider trading sentiment, and Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL) applies perfectly to this mantra.

Click here to learn why you should track hedge funds