Commerce Bancshares, Inc. (NASDAQ:CBSH) shareholders have witnessed a decrease in enthusiasm from smart money lately.
If you’d ask most shareholders, hedge funds are assumed to be slow, old financial vehicles of the past. While there are more than 8000 funds in operation at the moment, we at Insider Monkey choose to focus on the leaders of this club, about 450 funds. It is estimated that this group has its hands on most of the hedge fund industry’s total asset base, and by keeping an eye on their best equity investments, we have revealed a number of investment strategies that have historically outperformed Mr. Market. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points a year for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have beaten the S&P 500 index by 24 percentage points in 7 months (see the details here).
Just as integral, optimistic insider trading sentiment is a second way to break down the financial markets. Obviously, there are a number of incentives for an insider to drop shares of his or her company, but just one, very obvious reason why they would behave bullishly. Many empirical studies have demonstrated the useful potential of this method if shareholders understand where to look (learn more here).
With all of this in mind, we’re going to take a gander at the key action surrounding Commerce Bancshares, Inc. (NASDAQ:CBSH).
How are hedge funds trading Commerce Bancshares, Inc. (NASDAQ:CBSH)?
Heading into 2013, a total of 9 of the hedge funds we track were bullish in this stock, a change of -36% from one quarter earlier. With hedgies’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their holdings significantly.
According to our comprehensive database, Jim Simons’s Renaissance Technologies had the largest position in Commerce Bancshares, Inc. (NASDAQ:CBSH), worth close to $11.8 million, comprising less than 0.1%% of its total 13F portfolio. The second largest stake is held by Bryn Mawr Capital, managed by Ken Gray and Steve Walsh, which held a $7.8 million position; the fund has 0.7% of its 13F portfolio invested in the stock. Some other peers that hold long positions include Anil Stevens and Glenn Shapiro’s Parameter Capital Management, Cliff Asness’s AQR Capital Management and Israel Englander’s Millennium Management.
Because Commerce Bancshares, Inc. (NASDAQ:CBSH) has faced falling interest from hedge fund managers, it’s easy to see that there is a sect of hedgies that slashed their entire stakes heading into 2013. Interestingly, Israel Englander’s Catapult Capital Management sold off the biggest investment of all the hedgies we watch, valued at an estimated $5 million in stock.. Dmitry Balyasny’s fund, Balyasny Asset Management, also sold off its stock, about $3.9 million worth. These transactions are interesting, as total hedge fund interest was cut by 5 funds heading into 2013.
How are insiders trading Commerce Bancshares, Inc. (NASDAQ:CBSH)?
Insider buying is best served when the company in question has seen transactions within the past 180 days. Over the latest 180-day time frame, Commerce Bancshares, Inc. (NASDAQ:CBSH) has experienced 1 unique insiders purchasing, and 9 insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to Commerce Bancshares, Inc. (NASDAQ:CBSH). These stocks are Texas Capital Bancshares Inc (NASDAQ:TCBI), UMB Financial Corporation (NASDAQ:UMBF), Prosperity Bancshares, Inc. (NYSE:PB), BOK Financial Corporation (NASDAQ:BOKF), and Cullen/Frost Bankers, Inc. (NYSE:CFR). This group of stocks belong to the regional – southwest banks industry and their market caps are closest to CBSH’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Texas Capital Bancshares Inc (NASDAQ:TCBI) | 8 | 1 | 5 |
| UMB Financial Corporation (NASDAQ:UMBF) | 4 | 1 | 5 |
| Prosperity Bancshares, Inc. (NYSE:PB) | 14 | 1 | 3 |
| BOK Financial Corporation (NASDAQ:BOKF) | 10 | 0 | 5 |
| Cullen/Frost Bankers, Inc. (NYSE:CFR) | 7 | 0 | 5 |
With the results demonstrated by our studies, retail investors must always watch hedge fund and insider trading sentiment, and Commerce Bancshares, Inc. (NASDAQ:CBSH) is an important part of this process.
