Hedge Funds Are Buying Great Western Bancorp Inc (GWB)

Is Great Western Bancorp Inc (NYSE:GWB) a good equity to bet on right now? We like to check what the smart money thinks first before doing extensive research. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It’s not surprising given that hedge funds have access to better information and more resources to find the latest market-moving information.

Is Great Western Bancorp Inc (NYSE:GWB) a buy, sell, or hold? Hedge funds are getting more bullish. The number of bullish hedge fund positions rose by 10 recently. GWB was in 24 hedge funds’ portfolios at the end of September. There were 14 hedge funds in our database with GWB positions at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity, but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Polycom Inc (NASDAQ:PLCM), Evertec Inc (NYSE:EVTC), and Cvent Inc (NYSE:CVT) to gather more data points.

If you’d ask most stock holders, hedge funds are assumed to be unimportant, old investment tools of yesteryear. While there are over 8000 funds trading at present, Our researchers choose to focus on the crème de la crème of this club, about 700 funds. These investment experts handle the lion’s share of the smart money’s total asset base, and by observing their top investments, Insider Monkey has determined numerous investment strategies that have historically beaten the market. Insider Monkey’s small-cap hedge fund strategy beat the S&P 500 index by 12 percentage points annually for a decade in their back tests.

With all of this in mind, we’re going to analyze the recent action encompassing Great Western Bancorp Inc (NYSE:GWB).

What does the smart money think about Great Western Bancorp Inc (NYSE:GWB)?

At the end of the third quarter, a total of 24 of the hedge funds tracked by Insider Monkey were long this stock, an increase of 71% from the second quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of notable hedge fund managers who were upping their holdings substantially (or already accumulated large positions).

When looking at the institutional investors followed by Insider Monkey, Citadel Investment Group, managed by Ken Griffin, holds the biggest position in Great Western Bancorp Inc (NYSE:GWB). The fund has a $46.9 million position in the stock, comprising less than 0.1% of its 13F portfolio. The second largest stake is held by John A. Levin of Levin Capital Strategies, with a $38.4 million position; the fund has 0.7% of its 13F portfolio invested in the stock. Remaining peers that are bullish comprise Israel Englander’s Millennium Management, Robert Pohly’s Samlyn Capital and Neil Chriss’s Hutchin Hill Capital.

With a general bullishness amongst the heavyweights, specific money managers were breaking ground themselves. Samlyn Capital, managed by Robert Pohly, assembled the most outsized position in Great Western Bancorp Inc (NYSE:GWB), carrying a value of $29.7 million at the end of the quarter. Lee Munder’s Lee Munder Capital Group also initiated an $7.7 million position during the quarter. The other funds with brand new GWB positions are John Overdeck and David Siegel’s Two Sigma Advisors, Sharif Siddiqui’s Alpenglow Capital, and Ken Fisher’s Fisher Asset Management.

Let’s now take a look at hedge fund activity in other stocks similar to Great Western Bancorp Inc (NYSE:GWB). We will take a look at Polycom Inc (NASDAQ:PLCM), Evertec Inc (NYSE:EVTC), Cvent Inc (NYSE:CVT), and Mobile Mini Inc (NASDAQ:MINI). This group of stocks’ market valuations match GWB’s market valuation.

As you can see these stocks had an average of 16 hedge funds with bullish positions and the average amount invested in these stocks was $174 million. That figure was $274 million in GWB’s case, a good sign. Polycom Inc (NASDAQ:PLCM) is the most popular stock in this table. On the other hand Mobile Mini Inc (NASDAQ:MINI) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks Great Western Bancorp Inc (NYSE:GWB) is more popular among hedge funds. Considering that hedge funds are fond of this stock in relation to its market cap peers, it may be a good idea to analyze it in detail and potentially include it in your portfolio.