Dollar Tree, Inc. (NASDAQ:DLTR) was in 40 hedge funds’ portfolio at the end of the first quarter of 2013. DLTR has seen a decrease in enthusiasm from smart money lately. There were 40 hedge funds in our database with DLTR positions at the end of the previous quarter.
To the average investor, there are tons of indicators market participants can use to track publicly traded companies. A couple 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 best fund managers can outclass the market by a superb margin (see just how much).
Equally as beneficial, positive insider trading sentiment is another way to parse down the stock market universe. As the old adage goes: there are plenty of reasons for a bullish insider to sell shares of his or her company, but only one, very clear reason why they would initiate a purchase. Many academic studies have demonstrated the valuable potential of this strategy if piggybackers know where to look (learn more here).
Keeping this in mind, it’s important to take a look at the latest action regarding Dollar Tree, Inc. (NASDAQ:DLTR).
What have hedge funds been doing with Dollar Tree, Inc. (NASDAQ:DLTR)?
In preparation for this quarter, a total of 40 of the hedge funds we track were long in this stock, a change of 0% from the first quarter. With hedgies’ sentiment swirling, there exists a select group of noteworthy hedge fund managers who were boosting their holdings meaningfully.
When looking at the hedgies we track, Lone Pine Capital, managed by Stephen Mandel, holds the biggest position in Dollar Tree, Inc. (NASDAQ:DLTR). Lone Pine Capital has a $581.5 million position in the stock, comprising 3% of its 13F portfolio. The second largest stake is held by John Griffin of Blue Ridge Capital, with a $314.8 million position; 4% of its 13F portfolio is allocated to the stock. Remaining peers that hold long positions include Eric Mindich’s Eton Park Capital, Jonathon Jacobson’s Highfields Capital Management and Charles Akre’s Akre Capital Management.
Because Dollar Tree, Inc. (NASDAQ:DLTR) has witnessed bearish sentiment from the smart money, it’s easy to see that there is a sect of hedge funds who sold off their entire stakes last quarter. Intriguingly, Christian Leone’s Luxor Capital Group cut the largest position of all the hedgies we monitor, comprising an estimated $129.9 million in stock., and Lee Hobson of Highside Capital Management was right behind this move, as the fund said goodbye to about $14.2 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).
How have insiders been trading Dollar Tree, Inc. (NASDAQ:DLTR)?
Insider purchases made by high-level executives is particularly usable when the company in question has experienced transactions within the past half-year. Over the last six-month time period, Dollar Tree, Inc. (NASDAQ:DLTR) has experienced zero unique insiders buying, and 2 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity 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 match DLTR’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| PriceSmart, Inc. (NASDAQ:PSMT) | 7 | 0 | 7 |
| Costco Wholesale Corporation (NASDAQ:COST) | 41 | 0 | 14 |
| Target Corporation (NYSE:TGT) | 33 | 0 | 8 |
| Family Dollar Stores, Inc. (NYSE:FDO) | 27 | 0 | 3 |
| Dollar General Corp. (NYSE:DG) | 61 | 2 | 9 |
With the returns demonstrated by the aforementioned tactics, everyday investors must always watch hedge fund and insider trading sentiment, and Dollar Tree, Inc. (NASDAQ:DLTR) applies perfectly to this mantra.
