The worries about the election and the ongoing uncertainty about the path of interest-rate increases have been keeping investors on the sidelines. Of course, most hedge funds and other asset managers have been underperforming main stock market indices since the middle of 2015. Interestingly though, smaller-cap stocks registered their best performance relative to the large-capitalization stocks since the end of the June quarter, suggesting that this may be the best time to take a cue from their stock picks. In fact, the Russell 2000 Index gained more than 15% since the beginning of the third quarter, while the Standard and Poor’s 500 benchmark returned less than 6%. This article will lay out and discuss the hedge fund and institutional investor sentiment towards FB Financial Corp (NYSE:FBK).
FB Financial Corp (NYSE:FBK) shareholders have witnessed an increase in activity from the world’s largest hedge funds in recent months. There were zero hedge funds in our database with FBK positions at the end of June because the stock went public in September. At the end of this article we will also compare FBK to other stocks including Blucora Inc (NASDAQ:BCOR), Career Education Corp. (NASDAQ:CECO), and Lands’ End, Inc. (NASDAQ:LE) to get a better sense of its popularity.
Follow Fb Financial Corp (NYSE:FBK)
Follow Fb Financial Corp (NYSE:FBK)
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, let’s take a peek at the new action regarding FB Financial Corp (NYSE:FBK).
What does the smart money think about FB Financial Corp (NYSE:FBK)?
Heading into the fourth quarter of 2016, a total of 12 of the hedge funds tracked by Insider Monkey decided to bet on this stock. When looking at the institutional investors followed by Insider Monkey, Emanuel J. Friedman’s EJF Capital has the largest position in FB Financial Corp (NYSE:FBK), worth close to $12.1 million, amounting to 1% of its total 13F portfolio. The second most bullish fund manager is Millennium Management, one of the largest hedge funds in the world, holding a $5.6 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Some other hedge funds and institutional investors that hold long positions contain Paul Magidson, Jonathan Cohen. And Ostrom Enders’s Castine Capital Management, David Costen Haley’s HBK Investments and Ken Griffin’s Citadel Investment Group. 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.
As industrywide interest jumped, specific money managers have been driving this bullishness. The other funds with new positions in the stock are Castine Capital Management, HBK Investments, and Citadel Investment Group.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as FB Financial Corp (NYSE:FBK) but similarly valued. We will take a look at Blucora Inc (NASDAQ:BCOR), Career Education Corp. (NASDAQ:CECO), Lands’ End, Inc. (NASDAQ:LE), and Kinsale Capital Group Inc (NASDAQ:KNSL). This group of stocks’ market values are closest to FBK’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| BCOR | 20 | 73093 | -2 |
| CECO | 16 | 62286 | 7 |
| LE | 9 | 152042 | -1 |
| KNSL | 6 | 10395 | 6 |
As you can see these stocks had an average of 13 hedge funds with bullish positions and the average amount invested in these stocks was $74 million. That figure was $29 million in FBK’s case. Blucora Inc (NASDAQ:BCOR) is the most popular stock in this table. On the other hand Kinsale Capital Group Inc (NASDAQ:KNSL) is the least popular one with only 6 bullish hedge fund positions. FB Financial Corp (NYSE:FBK) 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 BCOR might be a better candidate to consider taking a long position in.
