Is Carnival Corporation (CCL) Going to Burn These Hedge Funds?

Carnival Corporation (NYSE:CCL) investors should pay attention to an increase in enthusiasm from smart money in recent months.

In the 21st century investor’s toolkit, there are many gauges investors can use to watch their holdings. Some of the best are hedge fund and insider trading activity. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the elite investment managers can beat the broader indices by a very impressive margin (see just how much).

Equally as integral, positive insider trading sentiment is another way to parse down the stock market universe. Obviously, there are a variety of motivations for a bullish insider to drop shares of his or her company, but just one, very clear reason why they would initiate a purchase. Various empirical studies have demonstrated the valuable potential of this strategy if investors understand where to look (learn more here).

Consequently, it’s important to take a peek at the latest action surrounding Carnival Corporation (NYSE:CCL).

What have hedge funds been doing with Carnival Corporation (NYSE:CCL)?

At the end of the first quarter, a total of 36 of the hedge funds we track held long positions in this stock, a change of 24% from the first quarter. With hedgies’ sentiment swirling, there exists a select group of key hedge fund managers who were increasing their stakes considerably.

According to our comprehensive database, Sandy Nairn’s Edinburgh Partners had the biggest position in Carnival Corporation (NYSE:CCL), worth close to $152.3 million, comprising 9.3% of its total 13F portfolio. Coming in second is Kerr Neilson of Platinum Asset Management, with a $134.1 million position; the fund has 2.9% of its 13F portfolio invested in the stock. Other hedge funds that hold long positions include James Dinan’s York Capital Management, Ken Griffin’s Citadel Investment Group and Michael Hintze’s CQS Cayman LP.

As one would reasonably expect, some big names were breaking ground themselves. HBK Investments, managed by David Costen Haley, established the largest position in Carnival Corporation (NYSE:CCL). HBK Investments had 29.3 million invested in the company at the end of the quarter. D. E. Shaw’s D E Shaw also made a $27.7 million investment in the stock during the quarter. The other funds with brand new CCL positions are Jim Simons’s Renaissance Technologies, Shane Finemore’s Manikay Partners, and Noam Gottesman’s GLG Partners.

How have insiders been trading Carnival Corporation (NYSE:CCL)?

Insider buying is most useful when the company in question has seen transactions within the past half-year. Over the latest half-year time period, Carnival Corporation (NYSE:CCL) has experienced zero unique insiders buying, and 9 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 Carnival Corporation (NYSE:CCL). These stocks are MGM Resorts International (NYSE:MGM), Royal Caribbean Cruises Ltd. (NYSE:RCL), Wynn Resorts, Limited (NASDAQ:WYNN), Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL), and Las Vegas Sands Corp. (NYSE:LVS). This group of stocks are the members of the resorts & casinos industry and their market caps match CCL’s market cap.