With the first-quarter round of 13F filings behind us, it is time to take a look at the stocks in which some of the best money managers in the world preferred to invest or sell heading into the second quarter. One of these stocks was FVCBankcorp, Inc. (NASDAQ:FVCB).
Is FVCBankcorp, Inc. (NASDAQ:FVCB) the right investment to pursue these days? Hedge funds are buying. The number of bullish hedge fund bets advanced by 1 in recent months. Our calculations also showed that FVCB isn't among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video below for Q2 rankings). Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
At the moment there is a multitude of gauges stock traders employ to appraise publicly traded companies. Some of the most under-the-radar gauges are hedge fund and insider trading interest. We have shown that, historically, those who follow the top picks of the elite money managers can beat the S&P 500 by a very impressive margin (see the details here).
[caption id="attachment_27676" align="alignnone" width="355"] Israel Englander of Millennium Management[/caption]
We leave no stone unturned when looking for the next great investment idea. For example, Discover is offering this insane cashback card, so we look into shorting the stock. One of the most bullish analysts in America just put his money where his mouth is. He says, "I'm investing more today than I did back in early 2009." So we check out his pitch. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We even check out this option genius' weekly trade ideas. This December, we recommended Adams Energy as a one-way bet based on an under-the-radar fund manager's investor letter and the stock already gained 20 percent. Keeping this in mind we're going to analyze the fresh hedge fund action encompassing FVCBankcorp, Inc. (NASDAQ:FVCB).
What does smart money think about FVCBankcorp, Inc. (NASDAQ:FVCB)?
At the end of the third quarter, a total of 3 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 50% from the previous quarter. By comparison, 6 hedge funds held shares or bullish call options in FVCB a year ago. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in FVCBankcorp, Inc. (NASDAQ:FVCB) was held by Elizabeth Park Capital Management, which reported holding $8.2 million worth of stock at the end of September. It was followed by Millennium Management with a $1 million position. The only other hedge fund that is bullish on the company was Renaissance Technologies.
As aggregate interest increased, specific money managers have been driving this bullishness. Millennium Management, managed by Israel Englander, established the biggest position in FVCBankcorp, Inc. (NASDAQ:FVCB). Millennium Management had $1 million invested in the company at the end of the quarter. Jim Simons (founder)'s Renaissance Technologies also made a $0.4 million investment in the stock during the quarter.
Let's now review hedge fund activity in other stocks similar to FVCBankcorp, Inc. (NASDAQ:FVCB). We will take a look at Xinyuan Real Estate Co., Ltd. (NYSE:XIN), Molecular Templates, Inc. (NASDAQ:MTEM), Permian Basin Royalty Trust (NYSE:PBT), and Immersion Corporation (NASDAQ:IMMR). This group of stocks' market caps resembles FVCB's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position XIN,5,2420,-2 MTEM,11,46850,-1 PBT,5,7687,-1 IMMR,16,91386,2 Average,9.25,37086,-0.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 9.25 hedge funds with bullish positions and the average amount invested in these stocks was $37 million. That figure was $10 million in FVCB's case. Immersion Corporation (NASDAQ:IMMR) is the most popular stock in this table. On the other hand, Xinyuan Real Estate Co., Ltd. (NYSE:XIN) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks FVCBankcorp, Inc. (NASDAQ:FVCB) is even less popular than XIN. Hedge funds dodged a bullet by taking a bearish stance towards FVCB. Our calculations showed that the top 20 most popular hedge fund stocks returned 37.4% in 2019 through the end of November and outperformed the S&P 500 ETF (SPY) by 9.9 percentage points. Unfortunately, FVCB wasn't nearly as popular as these 20 stocks (hedge fund sentiment was very bearish); FVCB investors were disappointed as the stock returned -2.4% during the fourth quarter (through the end of November) and underperformed the market. If you are interested in investing in large-cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 70 percent of these stocks already outperformed the market so far in Q4.
Disclosure: None. This article was originally published at Insider Monkey.