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 at Insider Monkey have gone over 730 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds' and investors' portfolio positions as of June 28th. In this article we look at what those investors think of TriCo Bancshares (NASDAQ:TCBK).
Is TriCo Bancshares (NASDAQ:TCBK) the right pick for your portfolio? Money managers are getting less optimistic. The number of long hedge fund positions were cut by 1 recently. Our calculations also showed that TCBK isn't among the 30 most popular stocks among hedge funds (see the video below). TCBK was in 8 hedge funds' portfolios at the end of June. There were 9 hedge funds in our database with TCBK positions at the end of the previous quarter. Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey's flagship best performing hedge funds strategy returned 25.8% year to date (through May 30th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 40 percentage points since its inception (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
Unlike former hedge manager, Dr. Steve Sjuggerud, who is convinced Dow will soar past 40000, our long-short investment strategy doesn't rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. We're going to go over the latest hedge fund action encompassing TriCo Bancshares (NASDAQ:TCBK).
What have hedge funds been doing with TriCo Bancshares (NASDAQ:TCBK)?
At Q2's end, a total of 8 of the hedge funds tracked by Insider Monkey were long this stock, a change of -11% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in TCBK over the last 16 quarters. With hedgies' sentiment swirling, there exists a select group of key hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).
More specifically, Renaissance Technologies was the largest shareholder of TriCo Bancshares (NASDAQ:TCBK), with a stake worth $25.1 million reported as of the end of March. Trailing Renaissance Technologies was Basswood Capital, which amassed a stake valued at $5.2 million. Millennium Management, AQR Capital Management, and Two Sigma Advisors were also very fond of the stock, giving the stock large weights in their portfolios.
Because TriCo Bancshares (NASDAQ:TCBK) has faced a decline in interest from hedge fund managers, we can see that there lies a certain "tier" of hedge funds that elected to cut their positions entirely last quarter. At the top of the heap, David Harding's Winton Capital Management cut the largest stake of all the hedgies monitored by Insider Monkey, totaling an estimated $0.2 million in call options. Matthew Hulsizer's fund, PEAK6 Capital Management, also dropped its call options, about $0.2 million worth. These transactions are interesting, as aggregate hedge fund interest was cut by 1 funds last quarter.
Let's now review hedge fund activity in other stocks similar to TriCo Bancshares (NASDAQ:TCBK). We will take a look at SRC Energy Inc. (NYSE:SRCI), Orchard Therapeutics plc (NASDAQ:ORTX), Sykes Enterprises, Incorporated (NASDAQ:SYKE), and Huron Consulting Group Inc. (NASDAQ:HURN). This group of stocks' market values resemble TCBK's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position SRCI,19,304872,5 ORTX,21,304905,8 SYKE,15,54740,-2 HURN,11,31189,0 Average,16.5,173927,2.75 [/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 $174 million. That figure was $37 million in TCBK's case. Orchard Therapeutics plc (NASDAQ:ORTX) is the most popular stock in this table. On the other hand Huron Consulting Group Inc. (NASDAQ:HURN) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks TriCo Bancshares (NASDAQ:TCBK) is even less popular than HURN. Hedge funds dodged a bullet by taking a bearish stance towards TCBK. Our calculations showed that the top 20 most popular hedge fund stocks returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Unfortunately TCBK wasn't nearly as popular as these 20 stocks (hedge fund sentiment was very bearish); TCBK investors were disappointed as the stock returned -3.4% during the third quarter 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 many of these stocks already outperformed the market so far in 2019.
Disclosure: None. This article was originally published at Insider Monkey.