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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. Insider Monkey finished processing 821 13F filings submitted by hedge funds and prominent investors. These filings show these funds' portfolio positions as of March 31st, 2020. What do these smart investors think about OP Bancorp (NASDAQ:OPBK)?
OP Bancorp (NASDAQ:OPBK) shareholders have witnessed an increase in hedge fund interest in recent months. Our calculations also showed that OPBK 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 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 monthly stock picks returned 101% since March 2017 and outperformed the S&P 500 ETFs by more than 58 percentage points. Our short strategy outperformed the S&P 500 short ETFs by 20 percentage points annually (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
[caption id="attachment_728717" align="aligncenter" width="400"]
Roger Ibbotson of Zebra Capital Management[/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 stocks recommended/scorned by legendary Bill Miller. 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 let's take a look at the new hedge fund action regarding OP Bancorp (NASDAQ:OPBK).
What does smart money think about OP Bancorp (NASDAQ:OPBK)?
At Q1's end, a total of 6 of the hedge funds tracked by Insider Monkey were long this stock, a change of 20% from the fourth quarter of 2019. The graph below displays the number of hedge funds with bullish position in OPBK over the last 18 quarters. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, EJF Capital held the most valuable stake in OP Bancorp (NASDAQ:OPBK), which was worth $6.4 million at the end of the third quarter. On the second spot was Renaissance Technologies which amassed $0.5 million worth of shares. Arrowstreet Capital, Millennium Management, and Zebra 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 EJF Capital allocated the biggest weight to OP Bancorp (NASDAQ:OPBK), around 1.35% of its 13F portfolio. Zebra Capital Management is also relatively very bullish on the stock, setting aside 0.18 percent of its 13F equity portfolio to OPBK.
Now, key hedge funds have been driving this bullishness. Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, initiated the largest position in OP Bancorp (NASDAQ:OPBK). Arrowstreet Capital had $0.3 million invested in the company at the end of the quarter. Ken Griffin's Citadel Investment Group also made a $0.1 million investment in the stock during the quarter.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as OP Bancorp (NASDAQ:OPBK) but similarly valued. These stocks are Olympic Steel, Inc. (NASDAQ:ZEUS), Oasis Petroleum Inc. (NYSE:OAS), BP Prudhoe Bay Royalty Trust (NYSE:BPT), and EMX Royalty Corporation (NYSE:EMX). This group of stocks' market values match OPBK's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ZEUS,5,2807,-1 OAS,13,3969,-4 BPT,2,194,0 EMX,2,3360,0 Average,5.5,2583,-1.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.5 hedge funds with bullish positions and the average amount invested in these stocks was $3 million. That figure was $8 million in OPBK's case. Oasis Petroleum Inc. (NYSE:OAS) is the most popular stock in this table. On the other hand BP Prudhoe Bay Royalty Trust (NYSE:BPT) is the least popular one with only 2 bullish hedge fund positions. OP Bancorp (NASDAQ:OPBK) 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. 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 13.9% in 2020 through June 10th but beat the market by 14.2 percentage points. Unfortunately OPBK wasn't nearly as popular as these 10 stocks and hedge funds that were betting on OPBK were disappointed as the stock returned -6% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as many of these stocks already outperformed the market so far this year.
Disclosure: None. This article was originally published at Insider Monkey.