Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track more than 700 prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds' recent losses in Facebook. Let’s take a closer look at what the funds we track think about First Citizens BancShares Inc. (NASDAQ:FCNCA) in this article.
First Citizens BancShares Inc. (NASDAQ:FCNCA) investors should pay attention to a decrease in support from the world's most elite money managers lately. Our calculations also showed that FCNCA isn't among the 30 most popular stocks among hedge funds.
In the eyes of most traders, hedge funds are perceived as unimportant, old financial vehicles of yesteryear. While there are more than 8,000 funds with their doors open at the moment, Our experts look at the top tier of this club, approximately 700 funds. These investment experts oversee bulk of all hedge funds' total asset base, and by keeping an eye on their top equity investments, Insider Monkey has discovered several investment strategies that have historically defeated Mr. Market. Insider Monkey's flagship hedge fund strategy outperformed the S&P 500 index by 6 percentage points a year since its inception in May 2014 through early November 2018. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 24% since February 2017 (through December 3rd) even though the market was up nearly 23% during the same period. We just shared a list of 11 short targets in our latest quarterly update.
Let's check out the key hedge fund action surrounding First Citizens BancShares Inc. (NASDAQ:FCNCA).
Hedge fund activity in First Citizens BancShares Inc. (NASDAQ:FCNCA)
Heading into the fourth quarter of 2018, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of -5% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in FCNCA over the last 13 quarters. So, let's see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey's hedge fund database, Israel Englander's Millennium Management has the biggest position in First Citizens BancShares Inc. (NASDAQ:FCNCA), worth close to $90.2 million, corresponding to 0.1% of its total 13F portfolio. The second largest stake is held by Chuck Royce of Royce & Associates, with a $67.7 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Some other hedge funds and institutional investors that hold long positions comprise Joe Huber's Huber Capital Management, Paul Marshall and Ian Wace's Marshall Wace LLP and Cliff Asness's AQR Capital Management.
Seeing as First Citizens BancShares Inc. (NASDAQ:FCNCA) has faced declining sentiment from hedge fund managers, it's safe to say that there is a sect of hedgies that slashed their positions entirely heading into Q3. It's worth mentioning that Ken Griffin's Citadel Investment Group dropped the largest investment of all the hedgies followed by Insider Monkey, totaling an estimated $1 million in stock. Matthew Tewksbury's fund, Stevens Capital Management, also dropped its stock, about $0.8 million worth. These bearish behaviors are important to note, as total hedge fund interest was cut by 1 funds heading into Q3.
Let's now take a look at hedge fund activity in other stocks similar to First Citizens BancShares Inc. (NASDAQ:FCNCA). These stocks are RenaissanceRe Holdings Ltd. (NYSE:RNR), Elbit Systems Ltd. (NASDAQ:ESLT), ITT Inc. (NYSE:ITT), and Morningstar, Inc. (NASDAQ:MORN). This group of stocks' market valuations match FCNCA's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position RNR,20,478444,4 ESLT,2,15993,-1 ITT,19,337779,-4 MORN,19,204386,2 Average,15,259151,0.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 15 hedge funds with bullish positions and the average amount invested in these stocks was $259 million. That figure was $259 million in FCNCA's case. RenaissanceRe Holdings Ltd. (NYSE:RNR) is the most popular stock in this table. On the other hand Elbit Systems Ltd. (NASDAQ:ESLT) is the least popular one with only 2 bullish hedge fund positions. First Citizens BancShares Inc. (NASDAQ:FCNCA) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. In this regard RNR might be a better candidate to consider a long position.
Disclosure: None. This article was originally published at Insider Monkey.