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The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We have processed the filings of the more than 700 world-class investment firms that we track and now have access to the collective wisdom contained in these filings, which are based on their December 31 holdings, data that is available nowhere else. Should you consider First Interstate Bancsystem Inc (NASDAQ:FIBK) for your portfolio? We'll look to this invaluable collective wisdom for the answer.
Is First Interstate Bancsystem Inc (NASDAQ:FIBK) a buy here? Prominent investors are becoming hopeful. The number of long hedge fund bets moved up by 1 in recent months. Our calculations also showed that FIBK isn't among the 30 most popular stocks among hedge funds. FIBK was in 13 hedge funds' portfolios at the end of the fourth quarter of 2018. There were 12 hedge funds in our database with FIBK holdings at the end of the previous 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' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.5% through March 12, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
We're going to take a look at the fresh hedge fund action surrounding First Interstate Bancsystem Inc (NASDAQ:FIBK).
What does the smart money think about First Interstate Bancsystem Inc (NASDAQ:FIBK)?
At Q4's end, a total of 13 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 8% from the second quarter of 2018. Below, you can check out the change in hedge fund sentiment towards FIBK over the last 14 quarters. With hedge funds' capital changing hands, there exists a few notable hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).
The largest stake in First Interstate Bancsystem Inc (NASDAQ:FIBK) was held by Millennium Management, which reported holding $27.5 million worth of stock at the end of December. It was followed by Citadel Investment Group with a $23 million position. Other investors bullish on the company included Renaissance Technologies, Mendon Capital Advisors, and AQR Capital Management.
Now, key money managers were leading the bulls' herd. Weld Capital Management, managed by Minhua Zhang, initiated the biggest position in First Interstate Bancsystem Inc (NASDAQ:FIBK). Weld Capital Management had $0.5 million invested in the company at the end of the quarter. David Costen Haley's HBK Investments also initiated a $0.3 million position during the quarter. The only other fund with a brand new FIBK position is Matthew Tewksbury's Stevens Capital Management.
Let's check out hedge fund activity in other stocks - not necessarily in the same industry as First Interstate Bancsystem Inc (NASDAQ:FIBK) but similarly valued. We will take a look at Tenneco Inc (NYSE:TEN), Golar LNG Limited (NASDAQ:GLNG), Allakos Inc. (NASDAQ:ALLK), and Watts Water Technologies Inc (NYSE:WTS). This group of stocks' market valuations match FIBK's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position TEN,25,239099,3 GLNG,32,501581,-2 ALLK,10,195505,-2 WTS,17,273895,2 Average,21,302520,0.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 21 hedge funds with bullish positions and the average amount invested in these stocks was $303 million. That figure was $83 million in FIBK's case. Golar LNG Limited (NASDAQ:GLNG) is the most popular stock in this table. On the other hand Allakos Inc. (NASDAQ:ALLK) is the least popular one with only 10 bullish hedge fund positions. First Interstate Bancsystem Inc (NASDAQ:FIBK) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed that top 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Unfortunately FIBK wasn't nearly as popular as these 15 stock (hedge fund sentiment was quite bearish); FIBK investors were disappointed as the stock returned 14.1% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.
Disclosure: None. This article was originally published at Insider Monkey.
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