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Here’s Why First Republic Bank (FRC) Clinched a Spot in Ensemble Capital’s Top Contributor List

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Ensemble Capital, an investment management firm, published its “Ensemble Fund” first quarter 2021 investor letter – a copy of which can be seen here. A return of 3.80% was delivered by the fund in the Q1 of 2021, below its S&P 500 benchmark that delivered a 6.17% return in the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Ensemble Capital, in their Q1 2021 investor letter, mentioned First Republic Bank (NYSE: FRC) and shared their insights on the company. First Republic Bank is a San Francisco, California-based bank and wealth management company that currently has a $30.4 billion market capitalization. Since the beginning of the year, FRC delivered an 18.94% return, extending its 12-month to 78.11%. As of April 21, 2021, the stock closed at $174.76 per share.

Here is what Ensemble Capital has to say about First Republic Bank in their Q1 2021 investor letter:

“Notable contributors to the Fund’s returns this quarter (included) First Republic Bank. First Republic Bank (4.6% weight in the Fund) revealed that despite the economic crisis in 2020, they took just $2.4 million in write downs on their loans, which rounds to 0.00%. This speaks volumes for their underwriting quality. Meanwhile, assets grew 23% and deposits were up 24% year-over-year in the fourth quarter, as First Republic continues to take market share in the lucrative high-net worth banking industry, supported by its unique corporate culture and business model that enables its bankers to focus on providing unparalleled customer service in an industry not known for it."

Billionaire Masayoshi Son’s Top 10 Stock Picks
Billionaire Masayoshi Son’s Top 10 Stock Picks

Pixabay/Public Domain

Our calculations show that First Republic Bank (NYSE: FRC) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, First Republic Bank was in 34 hedge fund portfolios, compared to 31 funds in the third quarter. FRC delivered a 12.32% return in the past 3 months.

The top 10 stocks among hedge funds returned 231.2% between 2015 and 2020, and outperformed the S&P 500 Index ETFs by more than 126 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Here you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

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 15 best innovative stocks to buy to pick the next Tesla that will deliver a 10x return. 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:

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