First Savings Financial Group, Inc. (FSFG): Are Hedge Funds Right About This Stock?

Hedge funds and large money managers usually invest with a focus on the long-term horizon and, therefore, short-lived dips or bumps on the charts usually don’t make them change their opinion towards a company. This time it may be different. The coronavirus pandemic destroyed the high correlations among major industries and asset classes. We are now in a stock pickers market where fundamentals of a stock have more effect on the price than the overall direction of the market. As a result we observe sudden and large changes in hedge fund positions depending on the news flow. Let’s take a look at the hedge fund sentiment towards First Savings Financial Group, Inc. (NASDAQ:FSFG) to find out whether there were any major changes in hedge funds’ views.

First Savings Financial Group, Inc. (NASDAQ:FSFG) was in 3 hedge funds’ portfolios at the end of March. The all time high for this statistic is 6. FSFG investors should be aware of an increase in hedge fund interest in recent months. There were 2 hedge funds in our database with FSFG holdings at the end of December. Our calculations also showed that FSFG isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).

In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s monthly stock picks returned 206.8% since March 2017 and outperformed the S&P 500 ETFs by more than 115 percentage points (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.

Phil Stone of Fourthstone LLC

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $28 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery 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. Now we’re going to go over the latest hedge fund action encompassing First Savings Financial Group, Inc. (NASDAQ:FSFG).

Do Hedge Funds Think FSFG Is A Good Stock To Buy Now?

At first quarter’s end, a total of 3 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 50% from one quarter earlier. On the other hand, there were a total of 4 hedge funds with a bullish position in FSFG a year ago. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were adding to their holdings meaningfully (or already accumulated large positions).

According to Insider Monkey’s hedge fund database, Phil Stone’s Fourthstone LLC has the biggest position in First Savings Financial Group, Inc. (NASDAQ:FSFG), worth close to $2.7 million, amounting to 1.4% of its total 13F portfolio. The second most bullish fund is Renaissance Technologies, with a $0.6 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. In terms of the portfolio weights assigned to each position Fourthstone LLC allocated the biggest weight to First Savings Financial Group, Inc. (NASDAQ:FSFG), around 1.36% of its 13F portfolio. Zebra Capital Management is also relatively very bullish on the stock, setting aside 0.25 percent of its 13F equity portfolio to FSFG.

Now, specific money managers were breaking ground themselves. Zebra Capital Management, managed by Roger Ibbotson, established the most valuable position in First Savings Financial Group, Inc. (NASDAQ:FSFG). Zebra Capital Management had $0.2 million invested in the company at the end of the quarter.

Let’s now take a look at hedge fund activity in other stocks similar to First Savings Financial Group, Inc. (NASDAQ:FSFG). These stocks are Palatin Technologies, Inc. (NYSE:PTN), GSI Technology, Inc. (NASDAQ:GSIT), OP Bancorp (NASDAQ:OPBK), Catalyst Biosciences Inc (NASDAQ:CBIO), Grupo Supervielle S.A. (NYSE:SUPV), Synchronoss Technologies, Inc. (NASDAQ:SNCR), and 180 Life Sciences Corp. (NASDAQ:ATNF). This group of stocks’ market caps match FSFG’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 6.3 hedge funds with bullish positions and the average amount invested in these stocks was $15 million. That figure was $4 million in FSFG’s case. Catalyst Biosciences Inc (NASDAQ:CBIO) is the most popular stock in this table. On the other hand Palatin Technologies, Inc. (NYSE:PTN) is the least popular one with only 2 bullish hedge fund positions. First Savings Financial Group, Inc. (NASDAQ:FSFG) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for FSFG is 24.6. 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 17.2% in 2021 through June 11th and still beat the market by 3.3 percentage points. A small number of hedge funds were also right about betting on FSFG as the stock returned 12.3% since the end of the first quarter (through 6/11) and outperformed the market by an even larger margin.

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