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 first 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 4.5 years and analyze what the smart money thinks of TCF Financial Corporation (NYSE:TCF) based on that data.
TCF Financial Corporation (NYSE:TCF) was in 19 hedge funds' portfolios at the end of the first quarter of 2020. TCF has experienced a decrease in enthusiasm from smart money lately. There were 24 hedge funds in our database with TCF positions at the end of the previous quarter. Our calculations also showed that TCF isn't among the 30 most popular stocks among hedge funds (click for Q1 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.
In the 21st century investor’s toolkit there are a multitude of metrics market participants put to use to value publicly traded companies. A duo of the best metrics are hedge fund and insider trading sentiment. Our researchers have shown that, historically, those who follow the best picks of the elite investment managers can outpace the broader indices by a superb margin (see the details here).
[caption id="attachment_256989" align="aligncenter" width="400"] Dmitry Balyasny of Balyasny Asset Management[/caption]
We leave no stone unturned when looking for the next great investment idea. For example Europe is set to become the world’s largest cannabis market, so we check out this European marijuana stock pitch. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now let's go over the latest hedge fund action regarding TCF Financial Corporation (NYSE:TCF).
What does smart money think about TCF Financial Corporation (NYSE:TCF)?
At the end of the first quarter, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of -21% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards TCF over the last 18 quarters. So, let's see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Pzena Investment Management held the most valuable stake in TCF Financial Corporation (NYSE:TCF), which was worth $23.5 million at the end of the third quarter. On the second spot was Adage Capital Management which amassed $18.8 million worth of shares. Balyasny Asset Management, Holocene Advisors, and Castine Capital Management 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 Tegean Capital Management allocated the biggest weight to TCF Financial Corporation (NYSE:TCF), around 10.27% of its 13F portfolio. Castine Capital Management is also relatively very bullish on the stock, earmarking 4.23 percent of its 13F equity portfolio to TCF.
Seeing as TCF Financial Corporation (NYSE:TCF) has experienced a decline in interest from the smart money, it's safe to say that there exists a select few funds that decided to sell off their entire stakes in the first quarter. Interestingly, Usman Waheed's Strycker View Capital cut the biggest position of all the hedgies watched by Insider Monkey, comprising an estimated $15.4 million in stock. Ravi Chopra's fund, Azora Capital, also said goodbye to its stock, about $10.9 million worth. These moves are important to note, as aggregate hedge fund interest dropped by 5 funds in the first quarter.
Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as TCF Financial Corporation (NYSE:TCF) but similarly valued. These stocks are Emcor Group Inc (NYSE:EME), Ormat Technologies, Inc. (NYSE:ORA), Schneider National, Inc. (NYSE:SNDR), and Enstar Group Ltd. (NASDAQ:ESGR). This group of stocks' market caps are closest to TCF's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position EME,24,201184,-5 ORA,9,164907,-7 SNDR,22,66577,0 ESGR,11,339675,-2 Average,16.5,193086,-3.5 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 16.5 hedge funds with bullish positions and the average amount invested in these stocks was $193 million. That figure was $101 million in TCF's case. Emcor Group Inc (NYSE:EME) is the most popular stock in this table. On the other hand Ormat Technologies, Inc. (NYSE:ORA) is the least popular one with only 9 bullish hedge fund positions. TCF Financial Corporation (NYSE:TCF) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.4% in 2020 through June 22nd but still beat the market by 15.9 percentage points. Hedge funds were also right about betting on TCF as the stock returned 34.1% in Q2 (through June 22nd) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published at Insider Monkey.