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In this article you are going to find out whether hedge funds think BOK Financial Corporation (NASDAQ:BOKF) is a good investment right now. We like to check what the smart money thinks first before doing extensive research on a given stock. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It's not surprising given that hedge funds have access to better information and more resources to predict the winners in the stock market.
Is BOK Financial Corporation (NASDAQ:BOKF) an outstanding investment today? Investors who are in the know are getting more optimistic. The number of bullish hedge fund positions advanced by 7 lately. Our calculations also showed that BOKF 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 today’s marketplace there are numerous metrics investors have at their disposal to evaluate publicly traded companies. Two of the most under-the-radar metrics are hedge fund and insider trading moves. Our researchers have shown that, historically, those who follow the best picks of the best hedge fund managers can outclass the market by a very impressive margin (see the details here).
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Ric Dillon of Diamond Hill CapitalRic DillonRic Dillon[/caption]
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out trades like this one. 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. With all of this in mind we're going to take a look at the fresh hedge fund action encompassing BOK Financial Corporation (NASDAQ:BOKF).
What does smart money think about BOK Financial Corporation (NASDAQ:BOKF)?
At the end of the first quarter, a total of 22 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 47% from one quarter earlier. On the other hand, there were a total of 16 hedge funds with a bullish position in BOKF a year ago. With hedge funds' capital changing hands, there exists a select group of key hedge fund managers who were adding to their holdings substantially (or already accumulated large positions).
More specifically, Ariel Investments was the largest shareholder of BOK Financial Corporation (NASDAQ:BOKF), with a stake worth $58.3 million reported as of the end of September. Trailing Ariel Investments was Diamond Hill Capital, which amassed a stake valued at $40.7 million. Royce & Associates, Millennium Management, and Arrowstreet Capital 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 Ariel Investments allocated the biggest weight to BOK Financial Corporation (NASDAQ:BOKF), around 1.02% of its 13F portfolio. Prescott Group Capital Management is also relatively very bullish on the stock, designating 0.4 percent of its 13F equity portfolio to BOKF.
With a general bullishness amongst the heavyweights, specific money managers have been driving this bullishness. Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, created the biggest position in BOK Financial Corporation (NASDAQ:BOKF). Arrowstreet Capital had $5.6 million invested in the company at the end of the quarter. Noam Gottesman's GLG Partners also made a $3.8 million investment in the stock during the quarter. The following funds were also among the new BOKF investors: D. E. Shaw's D E Shaw, Emanuel J. Friedman's EJF Capital, and Cliff Asness's AQR Capital Management.
Let's now take a look at hedge fund activity in other stocks - not necessarily in the same industry as BOK Financial Corporation (NASDAQ:BOKF) but similarly valued. These stocks are FirstCash, Inc. (NASDAQ:FCFS), Anixter International Inc. (NYSE:AXE), Emergent Biosolutions Inc (NYSE:EBS), and NIO Inc. (NYSE:NIO). This group of stocks' market caps resemble BOKF's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position FCFS,16,107030,0 AXE,21,541008,-22 EBS,17,114485,5 NIO,16,29111,0 Average,17.5,197909,-4.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 17.5 hedge funds with bullish positions and the average amount invested in these stocks was $198 million. That figure was $145 million in BOKF's case. Anixter International Inc. (NYSE:AXE) is the most popular stock in this table. On the other hand FirstCash, Inc. (NASDAQ:FCFS) is the least popular one with only 16 bullish hedge fund positions. Compared to these stocks BOK Financial Corporation (NASDAQ:BOKF) is more popular among hedge funds. 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 returned 13.9% in 2020 through June 10th but still managed to beat the market by 14.2 percentage points. Hedge funds were also right about betting on BOKF as the stock returned 44.1% so far in Q2 (through June 10th) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
Disclosure: None. This article was originally published at Insider Monkey.