Like everyone else, elite investors make mistakes. Some of their top consensus picks, such as Amazon, Facebook and Alibaba, have not done well in Q4 due to various reasons. Nevertheless, the data show elite investors’ consensus picks have done well on average over the long-term. The top 15 S&P 500 stocks among hedge funds at the end of September 2018 returned an average of 1% through March 15th whereas the S&P 500 Index ETF lost 2.2% during the same period. Because their consensus picks have done well, we pay attention to what elite funds think before doing extensive research on a stock. In this article, we take a closer look at QCR Holdings, Inc. (NASDAQ:QCRH) from the perspective of those elite funds.
QCR Holdings, Inc. (NASDAQ:QCRH) investors should pay attention to an increase in hedge fund sentiment of late. QCRH was in 9 hedge funds’ portfolios at the end of the fourth quarter of 2018. There were 8 hedge funds in our database with QCRH holdings at the end of the previous quarter. Our calculations also showed that qcrh isn’t among the 30 most popular stocks among hedge funds.
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 flagship best performing hedge funds strategy returned 20.7% year to date (through March 12th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 32 percentage points since its inception (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We’re going to take a peek at the new hedge fund action regarding QCR Holdings, Inc. (NASDAQ:QCRH).
What have hedge funds been doing with QCR Holdings, Inc. (NASDAQ:QCRH)?
At Q4’s end, a total of 9 of the hedge funds tracked by Insider Monkey were long this stock, a change of 13% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards QCRH over the last 14 quarters. With the smart money’s sentiment swirling, there exists a select group of key hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).
More specifically, Renaissance Technologies was the largest shareholder of QCR Holdings, Inc. (NASDAQ:QCRH), with a stake worth $16.7 million reported as of the end of December. Trailing Renaissance Technologies was Endicott Management, which amassed a stake valued at $13.8 million. Castine Capital Management, Elizabeth Park Capital Management, and Millennium Management were also very fond of the stock, giving the stock large weights in their portfolios.
With a general bullishness amongst the heavyweights, specific money managers have been driving this bullishness. Citadel Investment Group, managed by Ken Griffin, assembled the largest position in QCR Holdings, Inc. (NASDAQ:QCRH). Citadel Investment Group had $0.4 million invested in the company at the end of the quarter.
Let’s also examine hedge fund activity in other stocks similar to QCR Holdings, Inc. (NASDAQ:QCRH). We will take a look at Gilat Satellite Networks Ltd. (NASDAQ:GILT), MarineMax, Inc. (NYSE:HZO), Greenhill & Co., Inc. (NYSE:GHL), and First Defiance Financial Corp. (NASDAQ:FDEF). This group of stocks’ market valuations are closest to QCRH’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| GILT | 2 | 26919 | 0 |
| HZO | 17 | 48056 | 4 |
| GHL | 13 | 51851 | 3 |
| FDEF | 7 | 28181 | -1 |
| Average | 9.75 | 38752 | 1.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 9.75 hedge funds with bullish positions and the average amount invested in these stocks was $39 million. That figure was $54 million in QCRH’s case. MarineMax, Inc. (NYSE:HZO) is the most popular stock in this table. On the other hand Gilat Satellite Networks Ltd. (NASDAQ:GILT) is the least popular one with only 2 bullish hedge fund positions. QCR Holdings, Inc. (NASDAQ:QCRH) 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. Our calculations showed that top 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. Unfortunately QCRH wasn’t nearly as popular as these 15 stock (hedge fund sentiment was quite bearish); QCRH investors were disappointed as the stock returned 6.3% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.
Disclosure: None. This article was originally published at Insider Monkey.
