U.S. Markets close in 1 hr 35 mins

Here’s What Hedge Funds Think About United Bankshares, Inc. (UBSI)

Nina Todic

Does United Bankshares, Inc. (NASDAQ:UBSI) represent a good buying opportunity at the moment? Let’s briefly check the hedge fund interest towards the company. Hedge fund firms constantly search out bright intellectuals and highly-experienced employees and throw away millions of dollars on satellite photos and other research activities, so it is no wonder why they tend to generate millions in profits each year. It is also true that some hedge fund players fail inconceivably on some occasions, but net net their stock picks have been generating superior risk-adjusted returns on average over the years.

United Bankshares, Inc. (NASDAQ:UBSI) investors should pay attention to an increase in enthusiasm from smart money in recent months. UBSI was in 10 hedge funds' portfolios at the end of December. There were 7 hedge funds in our database with UBSI positions at the end of the previous quarter. Our calculations also showed that ubsi isn't among the 30 most popular stocks among hedge funds.

Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.5% through March 12, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

Matthew Lindenbaum Basswood Capital

Let's take a peek at the fresh hedge fund action regarding United Bankshares, Inc. (NASDAQ:UBSI).

Hedge fund activity in United Bankshares, Inc. (NASDAQ:UBSI)

Heading into the first quarter of 2019, a total of 10 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 43% from the second quarter of 2018. Below, you can check out the change in hedge fund sentiment towards UBSI over the last 14 quarters. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

No of Hedge Funds With UBSI Positions

Of the funds tracked by Insider Monkey, Cardinal Capital, managed by Amy Minella, holds the most valuable position in United Bankshares, Inc. (NASDAQ:UBSI). Cardinal Capital has a $15.3 million position in the stock, comprising 0.6% of its 13F portfolio. The second largest stake is held by Matthew Lindenbaum of Basswood Capital, with a $5.6 million position; the fund has 0.3% of its 13F portfolio invested in the stock. Other professional money managers with similar optimism encompass D. E. Shaw's D E Shaw, Noam Gottesman's GLG Partners and Dmitry Balyasny's Balyasny Asset Management.

With a general bullishness amongst the heavyweights, specific money managers have been driving this bullishness. D E Shaw, managed by D. E. Shaw, assembled the biggest position in United Bankshares, Inc. (NASDAQ:UBSI). D E Shaw had $1.7 million invested in the company at the end of the quarter. Dmitry Balyasny's Balyasny Asset Management also made a $1.3 million investment in the stock during the quarter. The following funds were also among the new UBSI investors: Jim Simons's Renaissance Technologies and Brandon Haley's Holocene Advisors.

Let's go over hedge fund activity in other stocks - not necessarily in the same industry as United Bankshares, Inc. (NASDAQ:UBSI) but similarly valued. These stocks are ACI Worldwide Inc (NASDAQ:ACIW), CoreSite Realty Corp (NYSE:COR), Plains GP Holdings LP (NYSE:PAGP), and Cimpress NV (NASDAQ:CMPR). This group of stocks' market values resemble UBSI's market value.

[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ACIW,21,272938,6 COR,15,181186,3 PAGP,18,203184,-5 CMPR,18,616894,1 Average,18,318551,1.25 [/table]

View table here if you experience formatting issues.

As you can see these stocks had an average of 18 hedge funds with bullish positions and the average amount invested in these stocks was $319 million. That figure was $28 million in UBSI's case. ACI Worldwide Inc (NASDAQ:ACIW) is the most popular stock in this table. On the other hand CoreSite Realty Corp (NYSE:COR) is the least popular one with only 15 bullish hedge fund positions. Compared to these stocks United Bankshares, Inc. (NASDAQ:UBSI) is even less popular than COR. Our calculations showed that top 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. A small number of hedge funds were also right about betting on UBSI, though not to the same extent, as the stock returned 23% and outperformed the market as well.

Disclosure: None. This article was originally published at Insider Monkey.

Related Content