Legendary investors such as Jeffrey Talpins 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 elite funds in these small-cap stocks. In the following paragraphs, we analyze IBERIABANK Corporation (NASDAQ:IBKC) from the perspective of those elite funds.
IBERIABANK Corporation (NASDAQ:IBKC) shareholders have witnessed an increase in activity from the world’s largest hedge funds lately. Our calculations also showed that ibkc isn’t among the 30 most popular stocks among hedge funds.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.5% through March 12, 2019. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Let’s take a look at the fresh hedge fund action encompassing IBERIABANK Corporation (NASDAQ:IBKC).
How have hedgies been trading IBERIABANK Corporation (NASDAQ:IBKC)?
At Q4’s end, a total of 24 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 14% from the previous quarter. By comparison, 21 hedge funds held shares or bullish call options in IBKC a year ago. So, let’s see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Citadel Investment Group held the most valuable stake in IBERIABANK Corporation (NASDAQ:IBKC), which was worth $69.9 million at the end of the third quarter. On the second spot was Millennium Management which amassed $38.1 million worth of shares. Moreover, Balyasny Asset Management, Gillson Capital, and Basswood Capital were also bullish on IBERIABANK Corporation (NASDAQ:IBKC), allocating a large percentage of their portfolios to this stock.
With a general bullishness amongst the heavyweights, key hedge funds were leading the bulls’ herd. Renaissance Technologies, managed by Jim Simons, initiated the largest position in IBERIABANK Corporation (NASDAQ:IBKC). Renaissance Technologies had $1.8 million invested in the company at the end of the quarter. Emanuel J. Friedman’s EJF Capital also initiated a $1.6 million position during the quarter. The other funds with brand new IBKC positions are Matthew Tewksbury’s Stevens Capital Management, Hoon Kim’s Quantinno Capital, and Thomas Bailard’s Bailard Inc.
Let’s check out hedge fund activity in other stocks similar to IBERIABANK Corporation (NASDAQ:IBKC). These stocks are Healthcare Realty Trust Inc (NYSE:HR), Ritchie Bros. Auctioneers Incorporated (NYSE:RBA), Echostar Corporation (NASDAQ:SATS), and ViaSat, Inc. (NASDAQ:VSAT). This group of stocks’ market valuations match IBKC’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| HR | 9 | 43650 | 5 |
| RBA | 12 | 90035 | -3 |
| SATS | 34 | 422161 | 6 |
| VSAT | 19 | 1763482 | 1 |
| Average | 18.5 | 579832 | 2.25 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 18.5 hedge funds with bullish positions and the average amount invested in these stocks was $580 million. That figure was $224 million in IBKC’s case. Echostar Corporation (NASDAQ:SATS) is the most popular stock in this table. On the other hand Healthcare Realty Trust Inc (NYSE:HR) is the least popular one with only 9 bullish hedge fund positions. IBERIABANK Corporation (NASDAQ:IBKC) is not the most popular stock in this group but hedge fund interest is still above average. 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. Hedge funds were also right about betting on IBKC, though not to the same extent, as the stock returned 16.8% and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.
