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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 817 13F filings submitted by hedge funds and prominent investors. These filings show these funds' portfolio positions as of September 30th, 2020. In this article we are going to take a look at smart money sentiment towards First Northwest Bancorp (NASDAQ:FNWB).
Hedge fund interest in First Northwest Bancorp (NASDAQ:FNWB) shares was flat at the end of last quarter. This is usually a negative indicator. Our calculations also showed that FNWB isn't among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks). At the end of this article we will also compare FNWB to other stocks including Xinyuan Real Estate Co., Ltd. (NYSE:XIN), Plumas Bancorp (NASDAQ:PLBC), and ReneSola Ltd. (NYSE:SOL) to get a better sense of its popularity.
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 113% since March 2017 and outperformed the S&P 500 ETFs by more than 66 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.
Jim Simons founder of Renaissance Technologies
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Keeping this in mind let's take a glance at the key hedge fund action regarding First Northwest Bancorp (NASDAQ:FNWB).
What does smart money think about First Northwest Bancorp (NASDAQ:FNWB)?
At Q3's end, a total of 3 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 0% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards FNWB over the last 21 quarters. With hedgies' capital changing hands, there exists an "upper tier" of notable hedge fund managers who were boosting their holdings considerably (or already accumulated large positions).
The largest stake in First Northwest Bancorp (NASDAQ:FNWB) was held by Private Capital Management, which reported holding $7 million worth of stock at the end of September. It was followed by Renaissance Technologies with a $4.4 million position. The only other hedge fund that is bullish on the company was Winton Capital Management.
Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren't any hedge funds dumping their holdings during the third quarter, there weren't any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven't identified any viable catalysts that can attract investor attention.
Let's now take a look at hedge fund activity in other stocks similar to First Northwest Bancorp (NASDAQ:FNWB). We will take a look at Xinyuan Real Estate Co., Ltd. (NYSE:XIN), Plumas Bancorp (NASDAQ:PLBC), ReneSola Ltd. (NYSE:SOL), Mackinac Financial Corporation (NASDAQ:MFNC), Information Services Group, Inc. (NASDAQ:III), MainStreet Bancshares, Inc. (NASDAQ:MNSB), and Aesthetic Medical International Holdings Group Ltd. (NASDAQ:AIH). All of these stocks' market caps resemble FNWB's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position XIN,3,514,1 PLBC,1,4439,0 SOL,5,31435,2 MFNC,6,7619,2 III,5,18567,0 MNSB,2,7282,-1 AIH,1,181,0 Average,3.3,10005,0.6 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 3.3 hedge funds with bullish positions and the average amount invested in these stocks was $10 million. That figure was $12 million in FNWB's case. Mackinac Financial Corporation (NASDAQ:MFNC) is the most popular stock in this table. On the other hand Plumas Bancorp (NASDAQ:PLBC) is the least popular one with only 1 bullish hedge fund positions. First Northwest Bancorp (NASDAQ:FNWB) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for FNWB is 37.9. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 28.1% in 2020 through November 23rd and still beat the market by 15.4 percentage points. A small number of hedge funds were also right about betting on FNWB as the stock returned 49.2% since the end of the third quarter (through 11/23) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.