Hedge Fund Sentiment Is Stagnant On First Financial Bancorp (FFBC)

Legendary investors such as Leon Cooperman and Seth Klarman earn enormous amounts of money for themselves and their investors by doing in-depth research on small-cap stocks that big brokerage houses don’t publish. Small cap stocks -especially when they are screened well- can generate substantial outperformance versus a boring index fund. That’s why we analyze the activity of those successful funds in these small-cap stocks. In the following paragraphs, we analyze First Financial Bancorp (NASDAQ:FFBC) from the perspective of those successful funds.

First Financial Bancorp (NASDAQ:FFBC) shares didn’t see a lot of action during the third quarter. Overall, hedge fund sentiment was unchanged. The stock was in 8 hedge funds’ portfolios at the end of September. At the end of this article we will also compare FFBC to other stocks including Qualys Inc (NASDAQ:QLYS), OneBeacon Insurance Group, Ltd. (NYSE:OB), and Cvent Inc (NYSE:CVT) to get a better sense of its popularity.

We care about hedge fund sentiment because historically hedge funds’ stock picks delivered strong risk adjusted returns. There are certain segments of the market where hedge funds’ stock picks performed much better than its benchmarks. For instance, the 30 most popular mid-cap stocks among the best performing hedge funds returned 18% over the last 12 months outpacing S&P 500 Index by more than 10 percentage points. We developed this strategy 2.5 years ago and started sharing its picks in our quarterly newsletter. It bested the S&P 500 Index ETFs by delivering a solid 39% vs. 22% gain for its benchmarks.

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How are hedge funds trading First Financial Bancorp (NASDAQ:FFBC)?

At the end of the third quarter, a total of 8 of the hedge funds tracked by Insider Monkey were bullish on this stock, unchanged from the previous quarter. By comparison, 12 hedge funds held shares or bullish call options in FFBC heading into this year. With hedgies’ sentiment swirling, there exists a select group of noteworthy hedge fund managers who were increasing their holdings meaningfully (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Millennium Management, one of the 10 largest hedge funds in the world, holds the number one position in First Financial Bancorp (NASDAQ:FFBC). Millennium Management has a $12.9 million position in the stock. On Millennium Management’s heels is Renaissance Technologies, which holds a $7.2 million position. Remaining peers that are bullish consist of Cliff Asness’ AQR Capital Management, Ken Griffin’s Citadel Investment Group and Roger Ibbotson’s Zebra Capital Management. 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.