Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds' and successful investors' positions as of the end of the fourth quarter. You can find articles about an individual hedge fund's trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 6 years and analyze what the smart money thinks of BancFirst Corporation (NASDAQ:BANF) based on that data.
Is BancFirst Corporation (NASDAQ:BANF) going to take off soon? The smart money was in an optimistic mood. The number of bullish hedge fund positions inched up by 2 lately. BancFirst Corporation (NASDAQ:BANF) was in 4 hedge funds' portfolios at the end of the first quarter of 2021. The all time high for this statistic is 13. Our calculations also showed that BANF isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings). There were 2 hedge funds in our database with BANF positions at the end of the fourth quarter.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Dmitry Balyasny of Balyasny Asset Management
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $27 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Keeping this in mind we're going to take a peek at the latest hedge fund action regarding BancFirst Corporation (NASDAQ:BANF).
Do Hedge Funds Think BANF Is A Good Stock To Buy Now?
At Q1's end, a total of 4 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 100% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in BANF over the last 23 quarters. With hedgies' sentiment swirling, there exists a select group of noteworthy hedge fund managers who were upping their stakes significantly (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Israel Englander's Millennium Management has the largest position in BancFirst Corporation (NASDAQ:BANF), worth close to $0.6 million, comprising less than 0.1%% of its total 13F portfolio. On Millennium Management's heels is Dmitry Balyasny of Balyasny Asset Management, with a $0.5 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Other peers that are bullish encompass Ken Griffin's Citadel Investment Group, Noam Gottesman's GLG Partners and . In terms of the portfolio weights assigned to each position Balyasny Asset Management allocated the biggest weight to BancFirst Corporation (NASDAQ:BANF), around 0.0023% of its 13F portfolio. GLG Partners is also relatively very bullish on the stock, dishing out 0.0011 percent of its 13F equity portfolio to BANF.
Now, some big names have been driving this bullishness. Millennium Management, managed by Israel Englander, initiated the largest position in BancFirst Corporation (NASDAQ:BANF). Millennium Management had $0.6 million invested in the company at the end of the quarter. Dmitry Balyasny's Balyasny Asset Management also made a $0.5 million investment in the stock during the quarter. The only other fund with a brand new BANF position is Noam Gottesman's GLG Partners.
Let's also examine hedge fund activity in other stocks similar to BancFirst Corporation (NASDAQ:BANF). We will take a look at Cactus, Inc. (NYSE:WHD), NIC Inc. (NASDAQ:EGOV), Welbilt, Inc. (NYSE:WBT), Phreesia, Inc. (NYSE:PHR), PQ Group Holdings Inc. (NYSE:PQG), Greatbatch Inc (NYSE:GB), and Dave & Buster's Entertainment, Inc. (NASDAQ:PLAY). All of these stocks' market caps match BANF's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position WHD,20,135752,1 EGOV,34,346790,19 WBT,28,400427,3 PHR,27,213201,1 PQG,8,32900,-1 GB,16,1810814,1 PLAY,24,540055,3 Average,22.4,497134,3.9 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 22.4 hedge funds with bullish positions and the average amount invested in these stocks was $497 million. That figure was $2 million in BANF's case. NIC Inc. (NASDAQ:EGOV) is the most popular stock in this table. On the other hand PQ Group Holdings Inc. (NYSE:PQG) is the least popular one with only 8 bullish hedge fund positions. Compared to these stocks BancFirst Corporation (NASDAQ:BANF) is even less popular than PQG. Our overall hedge fund sentiment score for BANF is 16.2. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Hedge funds dodged a bullet by taking a bearish stance towards BANF. Our calculations showed that the top 10 most popular hedge fund stocks returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 17.2% in 2021 through June 11th but managed to beat the market again by 3.3 percentage points. Unfortunately BANF wasn't nearly as popular as these 5 stocks (hedge fund sentiment was very bearish); BANF investors were disappointed as the stock returned -6.1% since the end of the first quarter (through 6/11) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market since 2019.
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Disclosure: None. This article was originally published at Insider Monkey.