Is Kellogg Company (K) Going to Burn These Hedge Funds?

Kellogg Company (NYSE:K) has seen an increase in hedge fund sentiment recently.

In today’s marketplace, there are plenty of gauges market participants can use to watch stocks. A pair of the most useful are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the top fund managers can trounce the broader indices by a significant amount (see just how much).

Equally as important, optimistic insider trading sentiment is a second way to parse down the financial markets. There are lots of reasons for an executive to sell shares of his or her company, but just one, very obvious reason why they would buy. Various academic studies have demonstrated the impressive potential of this tactic if you understand where to look (learn more here).

Consequently, we’re going to take a peek at the key action regarding Kellogg Company (NYSE:K).

What does the smart money think about Kellogg Company (NYSE:K)?

At Q1’s end, a total of 18 of the hedge funds we track held long positions in this stock, a change of 13% from the first quarter. With hedge funds’ capital changing hands, there exists a few key hedge fund managers who were increasing their holdings significantly.

According to our comprehensive database, Ken Griffin’s Citadel Investment Group had the biggest position in Kellogg Company (NYSE:K), worth close to $268.3 million, accounting for 0.4% of its total 13F portfolio. Sitting at the No. 2 spot is Mario Gabelli of GAMCO Investors, with a $61.3 million position; the fund has 0.4% of its 13F portfolio invested in the stock. Some other peers that hold long positions include Israel Englander’s Millennium Management, Clint Carlson’s Carlson Capital and David Harding’s Winton Capital Management.

Consequently, key money managers have been driving this bullishness. Carlson Capital, managed by Clint Carlson, established the most outsized position in Kellogg Company (NYSE:K). Carlson Capital had 19 million invested in the company at the end of the quarter. David Harding’s Winton Capital Management also made a $12.7 million investment in the stock during the quarter. The following funds were also among the new K investors: Mark Kingdon’s Kingdon Capital, Steven Cohen’s SAC Capital Advisors, and John Overdeck and David Siegel’s Two Sigma Advisors.

What do corporate executives and insiders think about Kellogg Company (NYSE:K)?

Insider buying is best served when the company we’re looking at has experienced transactions within the past six months. Over the latest 180-day time frame, Kellogg Company (NYSE:K) has experienced zero unique insiders buying, and 9 insider sales (see the details of insider trades here).

Let’s also examine hedge fund and insider activity in other stocks similar to Kellogg Company (NYSE:K). These stocks are The J.M. Smucker Company (NYSE:SJM), Campbell Soup Company (NYSE:CPB), ConAgra Foods, Inc. (NYSE:CAG), Mead Johnson Nutrition CO (NYSE:MJN), and General Mills, Inc. (NYSE:GIS). This group of stocks belong to the processed & packaged goods industry and their market caps resemble K’s market cap.

With the results shown by our research, retail investors must always watch hedge fund and insider trading activity, and Kellogg Company (NYSE:K) is an important part of this process.

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