At Insider Monkey, we pore over the filings of nearly 873 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we’ve gathered as a result gives us access to a wealth of collective knowledge based on these firms’ portfolio holdings as of June 30th. In this article, we will use that wealth of knowledge to determine whether or not Trustmark Corp (NASDAQ:TRMK) makes for a good investment right now.
Trustmark Corp (NASDAQ:TRMK) has seen an increase in hedge fund interest recently. Trustmark Corp (NASDAQ:TRMK) was in 10 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 18. There were 7 hedge funds in our database with TRMK positions at the end of the first quarter. Our calculations also showed that TRMK isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 79 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
David E. Shaw of D.E. Shaw
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best EV stocks 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 homepage. Keeping this in mind we’re going to take a glance at the new hedge fund action surrounding Trustmark Corp (NASDAQ:TRMK).
Do Hedge Funds Think TRMK Is A Good Stock To Buy Now?
At the end of the second quarter, a total of 10 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 43% from the previous quarter. By comparison, 17 hedge funds held shares or bullish call options in TRMK a year ago. With hedgies’ capital changing hands, there exists an “upper tier” of key hedge fund managers who were adding to their holdings substantially (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, AQR Capital Management, managed by Cliff Asness, holds the number one position in Trustmark Corp (NASDAQ:TRMK). AQR Capital Management has a $7.4 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Sitting at the No. 2 spot is Citadel Investment Group, led by Ken Griffin, holding a $1.7 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other members of the smart money that are bullish consist of Israel Englander’s Millennium Management, D. E. Shaw’s D E Shaw and John Overdeck and David Siegel’s Two Sigma Advisors. In terms of the portfolio weights assigned to each position Winton Capital Management allocated the biggest weight to Trustmark Corp (NASDAQ:TRMK), around 0.02% of its 13F portfolio. AQR Capital Management is also relatively very bullish on the stock, designating 0.01 percent of its 13F equity portfolio to TRMK.
With a general bullishness amongst the heavyweights, specific money managers were leading the bulls’ herd. Millennium Management, managed by Israel Englander, assembled the most outsized position in Trustmark Corp (NASDAQ:TRMK). Millennium Management had $1.3 million invested in the company at the end of the quarter. Renaissance Technologies also initiated a $0.4 million position during the quarter. The only other fund with a new position in the stock is Donald Sussman’s Paloma Partners.
Let’s also examine hedge fund activity in other stocks – not necessarily in the same industry as Trustmark Corp (NASDAQ:TRMK) but similarly valued. These stocks are Arcus Biosciences, Inc. (NYSE:RCUS), Washington Real Estate Investment Trust (NYSE:WRE), iRhythm Technologies, Inc. (NASDAQ:IRTC), Inovio Pharmaceuticals Inc (NYSE:INO), ACM Research, Inc. (NASDAQ:ACMR), Carpenter Technology Corporation (NYSE:CRS), and Palomar Holdings, Inc. (NASDAQ:PLMR). This group of stocks’ market values resemble TRMK’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| RCUS | 22 | 403654 | -5 |
| WRE | 7 | 37013 | -3 |
| IRTC | 22 | 215499 | 3 |
| INO | 8 | 37439 | -3 |
| ACMR | 18 | 273523 | -1 |
| CRS | 10 | 67269 | -4 |
| PLMR | 6 | 8596 | -5 |
| Average | 13.3 | 148999 | -2.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.3 hedge funds with bullish positions and the average amount invested in these stocks was $149 million. That figure was $14 million in TRMK’s case. Arcus Biosciences, Inc. (NYSE:RCUS) is the most popular stock in this table. On the other hand Palomar Holdings, Inc. (NASDAQ:PLMR) is the least popular one with only 6 bullish hedge fund positions. Trustmark Corp (NASDAQ:TRMK) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for TRMK is 37.2. 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 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 25.7% in 2021 through September 27th and still beat the market by 6.2 percentage points. A small number of hedge funds were also right about betting on TRMK as the stock returned 7% since the end of the second quarter (through 9/27) and outperformed the market by an even larger margin.
Follow Trustmark Corp (NASDAQ:TRMK)
Follow Trustmark Corp (NASDAQ:TRMK)
Suggested Articles:
- 10 Best Chemical Stocks To Buy For 2021
- 10 Best Mortgage Stocks To Buy Now
- 10 Best Penny Stocks To Buy Now
Disclosure: None. This article was originally published at Insider Monkey.
