Hedge Funds and other institutional investors have just completed filing their 13Fs with the Securities and Exchange Commission, revealing their equity portfolios as of the end of September. At Insider Monkey, we follow nearly 900 active hedge funds and notable investors and by analyzing their 13F filings, we can determine the stocks that they are collectively bullish on. One of their picks is Signature Bank (NASDAQ:SBNY), so let’s take a closer look at the sentiment that surrounds it in the current quarter.
Signature Bank (NASDAQ:SBNY) investors should pay attention to an increase in hedge fund interest in recent months. Signature Bank (NASDAQ:SBNY) was in 46 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic was previously 43. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. Our calculations also showed that SBNY isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings).
Emanuel Friedman of EJF Capital
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so 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. Now we’re going to check out the recent hedge fund action surrounding Signature Bank (NASDAQ:SBNY).
Do Hedge Funds Think SBNY Is A Good Stock To Buy Now?
At the end of September, a total of 46 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 7% from the previous quarter. By comparison, 35 hedge funds held shares or bullish call options in SBNY a year ago. With hedgies’ sentiment swirling, there exists a few key hedge fund managers who were adding to their holdings meaningfully (or already accumulated large positions).
The largest stake in Signature Bank (NASDAQ:SBNY) was held by Citadel Investment Group, which reported holding $107.2 million worth of stock at the end of September. It was followed by Samlyn Capital with a $63.9 million position. Other investors bullish on the company included EJF Capital, Point72 Asset Management, and Adage Capital Management. In terms of the portfolio weights assigned to each position Toscafund Asset Management allocated the biggest weight to Signature Bank (NASDAQ:SBNY), around 20.2% of its 13F portfolio. Engle Capital is also relatively very bullish on the stock, earmarking 9.11 percent of its 13F equity portfolio to SBNY.
As one would reasonably expect, key money managers were leading the bulls’ herd. Junto Capital Management, managed by James Parsons, established the most outsized position in Signature Bank (NASDAQ:SBNY). Junto Capital Management had $56.3 million invested in the company at the end of the quarter. Ben Levine, Andrew Manuel and Stefan Renold’s LMR Partners also initiated a $21.4 million position during the quarter. The other funds with brand new SBNY positions are Fred Cummings’s Elizabeth Park Capital Management, Josh Donfeld and David Rogers’s Castle Hook Partners, and Gregg Moskowitz’s Interval Partners.
Let’s also examine hedge fund activity in other stocks similar to Signature Bank (NASDAQ:SBNY). We will take a look at PPD, Inc. (NASDAQ:PPD), EXACT Sciences Corporation (NASDAQ:EXAS), Markel Corporation (NYSE:MKL), Viatris Inc. (NASDAQ:VTRS), Westinghouse Air Brake Technologies Corporation (NYSE:WAB), Conagra Brands, Inc. (NYSE:CAG), and Coupa Software Incorporated (NASDAQ:COUP). This group of stocks’ market valuations are closest to SBNY’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| PPD | 37 | 1890261 | 0 |
| EXAS | 40 | 1984372 | 5 |
| MKL | 25 | 689937 | -8 |
| VTRS | 55 | 1466403 | 2 |
| WAB | 38 | 2982164 | -8 |
| CAG | 20 | 625323 | -9 |
| COUP | 52 | 4542300 | -2 |
| Average | 38.1 | 2025823 | -2.9 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 38.1 hedge funds with bullish positions and the average amount invested in these stocks was $2026 million. That figure was $951 million in SBNY’s case. Viatris Inc. (NASDAQ:VTRS) is the most popular stock in this table. On the other hand Conagra Brands, Inc. (NYSE:CAG) is the least popular one with only 20 bullish hedge fund positions. Signature Bank (NASDAQ:SBNY) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for SBNY is 75.1. 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 28.6% in 2021 through November 30th and still beat the market by 5.6 percentage points. Hedge funds were also right about betting on SBNY as the stock returned 11.2% since the end of Q3 (through 11/30) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.
