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Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 817 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is First Financial Bancorp (NASDAQ:FFBC), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Is FFBC a good stock to buy now? First Financial Bancorp (NASDAQ:FFBC) investors should be aware of an increase in support from the world's most elite money managers lately. First Financial Bancorp (NASDAQ:FFBC) was in 16 hedge funds' portfolios at the end of the third quarter of 2020. The all time high for this statistic is 13. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 13 hedge funds in our database with FFBC positions at the end of the second quarter. Our calculations also showed that FFBC isn't among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
To most shareholders, hedge funds are viewed as worthless, outdated financial vehicles of the past. While there are over 8000 funds with their doors open at the moment, We choose to focus on the crème de la crème of this club, about 850 funds. It is estimated that this group of investors administer the majority of the smart money's total capital, and by shadowing their unrivaled investments, Insider Monkey has unearthed several investment strategies that have historically outperformed the broader indices. Insider Monkey's flagship short hedge fund strategy beat the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Our portfolio of short stocks lost 13% since February 2017 (through November 17th) even though the market was up 65% during the same period. We just shared a list of 6 short targets in our latest quarterly update .
Emanuel Friedman of EJF Capital
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. 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 website. With all of this in mind we're going to check out the key hedge fund action encompassing First Financial Bancorp (NASDAQ:FFBC).
Do Hedge Funds Think FFBC Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 16 of the hedge funds tracked by Insider Monkey were long this stock, a change of 23% from the second quarter of 2020. On the other hand, there were a total of 7 hedge funds with a bullish position in FFBC a year ago. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Millennium Management was the largest shareholder of First Financial Bancorp (NASDAQ:FFBC), with a stake worth $6.6 million reported as of the end of September. Trailing Millennium Management was Arrowstreet Capital, which amassed a stake valued at $3.7 million. Citadel Investment Group, EJF Capital, and D E Shaw were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position EJF Capital allocated the biggest weight to First Financial Bancorp (NASDAQ:FFBC), around 0.14% of its 13F portfolio. Tudor Investment Corp is also relatively very bullish on the stock, designating 0.02 percent of its 13F equity portfolio to FFBC.
As industrywide interest jumped, specific money managers have jumped into First Financial Bancorp (NASDAQ:FFBC) headfirst. Tudor Investment Corp, managed by Paul Tudor Jones, created the biggest position in First Financial Bancorp (NASDAQ:FFBC). Tudor Investment Corp had $0.5 million invested in the company at the end of the quarter. Michael Gelband's ExodusPoint Capital also initiated a $0.4 million position during the quarter. The other funds with new positions in the stock are Greg Eisner's Engineers Gate Manager, Benjamin A. Smith's Laurion Capital Management, and Cliff Asness's AQR Capital Management.
Let's check out hedge fund activity in other stocks - not necessarily in the same industry as First Financial Bancorp (NASDAQ:FFBC) but similarly valued. These stocks are Northwest Bancshares, Inc. (NASDAQ:NWBI), FBL Financial Group, Inc. (NYSE:FFG), Vista Outdoor Inc (NYSE:VSTO), Calavo Growers, Inc. (NASDAQ:CVGW), Fortuna Silver Mines Inc. (NYSE:FSM), NBT Bancorp Inc. (NASDAQ:NBTB), and FB Financial Corporation (NYSE:FBK). This group of stocks' market caps are similar to FFBC's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position NWBI,9,20409,1 FFG,11,46916,5 VSTO,28,257079,6 CVGW,11,80472,-3 FSM,13,53788,4 NBTB,8,10403,-1 FBK,9,49679,-3 Average,12.7,74107,1.3 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 12.7 hedge funds with bullish positions and the average amount invested in these stocks was $74 million. That figure was $21 million in FFBC's case. Vista Outdoor Inc (NYSE:VSTO) is the most popular stock in this table. On the other hand NBT Bancorp Inc. (NASDAQ:NBTB) is the least popular one with only 8 bullish hedge fund positions. First Financial Bancorp (NASDAQ:FFBC) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for FFBC is 58. 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. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 30.7% in 2020 through December 14th and still beat the market by 15.8 percentage points. Hedge funds were also right about betting on FFBC as the stock returned 47.9% since the end of Q3 (through 12/14) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.