Beneficial Mutual Bancorp Inc (BNCL): Are Hedge Funds Right About This Stock?

At Insider Monkey we track the activity of some of the best-performing hedge funds like Appaloosa Management, Baupost, and Third Point because we determined that some of the stocks that they are collectively bullish on can help us generate returns above the broader indices. Out of thousands of stocks that hedge funds invest in, small-caps can provide the best returns over the long term due to the fact that these companies are less efficiently priced and are usually under the radars of mass-media, analysts and dumb money. This is why we follow the smart money moves in the small-cap space.

Is Beneficial Mutual Bancorp Inc (NASDAQ:BNCL) a cheap investment now? Money managers are unambiguously getting less bullish. The number of long hedge fund bets that are revealed through the 13F filings went down by 8 lately. There were 22 hedge funds in our database with BNCL positions at the end of the previous quarter. At the end of this article we will also compare BNCL to other stocks including Penn National Gaming, Inc (NASDAQ:PENN), Popeyes Louisiana Kitchen Inc (NASDAQ:PLKI), and BancFirst Corporation (NASDAQ:BANF) to get a better sense of its popularity.

At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.

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With all of this in mind, we’re going to review the key action surrounding Beneficial Mutual Bancorp Inc (NASDAQ:BNCL).

How are hedge funds trading Beneficial Mutual Bancorp Inc (NASDAQ:BNCL)?

At Q3’s end, a total of 14 of the hedge funds tracked by Insider Monkey were bullish on this stock, a drop of 36% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in BNCL over the last 5 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

According to Insider Monkey’s hedge fund database, Jim Simons’ Renaissance Technologies holds the biggest position in Beneficial Mutual Bancorp Inc (NASDAQ:BNCL). Renaissance Technologies has a $49.3 million position in the stock, comprising 0.1% of its 13F portfolio. On Renaissance Technologies’ heels is D. E. Shaw’s D E Shaw, holding a $12 million position; the fund has less than 0.1% of its 13F portfolio invested in the stock. Some other professional money managers that hold long positions comprise Phill Gross and Robert Atchinson’s Adage Capital Management, Israel Englander’s Millennium Management and John D. Gillespie’s Prospector Partners. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.

Now that we’ve mentioned the most bullish investors, let’s also take a look at some funds that sold off their entire stakes in the stock during the third quarter. It’s worth mentioning that Matt Sirovich and Jeremy Mindich’s Scopia Capital sold off the biggest investment of all the investors watched by Insider Monkey, totaling close to $15.9 million in stock, and Neil Chriss’ Hutchin Hill Capital was right behind this move, as the fund cut about $9.3 million worth of shares.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Beneficial Mutual Bancorp Inc (NASDAQ:BNCL) but similarly valued. We will take a look at Penn National Gaming, Inc (NASDAQ:PENN), Popeyes Louisiana Kitchen Inc (NASDAQ:PLKI), BancFirst Corporation (NASDAQ:BANF), and First Bancorp (NYSE:FBP). This group of stocks’ market values resemble BNCL’s market value.

As you can see these stocks had an average of 16 hedge funds with bullish positions and the average amount invested in these stocks was $168 million. That figure was $119 million in BNCL’s case. Penn National Gaming, Inc (NASDAQ:PENN) is the most popular stock in this table. On the other hand BancFirst Corporation (NASDAQ:BANF) is the least popular one with only 8 bullish hedge fund positions. Beneficial Mutual Bancorp Inc (NASDAQ:BNCL) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard PENN might be a better candidate to consider taking a long position in.

Disclosure: none