We at Insider Monkey have gone over 738 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds’ and investors’ portfolio positions as of March 31st. In this article, we look at what those funds think of Bank of Hawaii Corporation (NYSE:BOH) based on that data.
Bank of Hawaii Corporation (NYSE:BOH) investors should be aware of a decrease in hedge fund interest in recent months. Our calculations also showed that BOH isn’t among the 30 most popular stocks among hedge funds.
So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter. Even if you aren’t comfortable with shorting stocks, you should at least avoid initiating long positions in our short portfolio.
We’re going to take a look at the key hedge fund action regarding Bank of Hawaii Corporation (NYSE:BOH).
What does smart money think about Bank of Hawaii Corporation (NYSE:BOH)?
Heading into the second quarter of 2019, a total of 12 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -8% from the fourth quarter of 2018. Below, you can check out the change in hedge fund sentiment towards BOH over the last 15 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds, Renaissance Technologies held the most valuable stake in Bank of Hawaii Corporation (NYSE:BOH), which was worth $37.1 million at the end of the first quarter. On the second spot was Citadel Investment Group which amassed $24 million worth of shares. Moreover, Royce & Associates, Millennium Management, and Balyasny Asset Management were also bullish on Bank of Hawaii Corporation (NYSE:BOH), allocating a large percentage of their portfolios to this stock.
Judging by the fact that Bank of Hawaii Corporation (NYSE:BOH) has faced declining sentiment from hedge fund managers, logic holds that there exists a select few money managers that elected to cut their entire stakes last quarter. At the top of the heap, D. E. Shaw’s D E Shaw dropped the biggest investment of all the hedgies tracked by Insider Monkey, comprising close to $0.6 million in stock, and Andrew Feldstein and Stephen Siderow’s Blue Mountain Capital was right behind this move, as the fund dropped about $0.1 million worth. These moves are important to note, as aggregate hedge fund interest fell by 1 funds last quarter.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Bank of Hawaii Corporation (NYSE:BOH) but similarly valued. These stocks are Lions Gate Entertainment Corporation (NYSE:LGF-A), American National Insurance Company (NASDAQ:ANAT), NCR Corporation (NYSE:NCR), and Cabot Microelectronics Corporation (NASDAQ:CCMP). This group of stocks’ market caps match BOH’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| LGF-A | 18 | 315578 | -3 |
| ANAT | 9 | 37272 | -6 |
| NCR | 22 | 250591 | 2 |
| CCMP | 17 | 273525 | -3 |
| Average | 16.5 | 219242 | -2.5 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 16.5 hedge funds with bullish positions and the average amount invested in these stocks was $219 million. That figure was $126 million in BOH’s case. NCR Corporation (NYSE:NCR) is the most popular stock in this table. On the other hand American National Insurance Company (NASDAQ:ANAT) is the least popular one with only 9 bullish hedge fund positions. Bank of Hawaii Corporation (NYSE:BOH) 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 20 most popular stocks among hedge funds returned 6.2% in Q2 through June 19th and outperformed the S&P 500 ETF (SPY) by nearly 3 percentage points. Unfortunately BOH wasn’t nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); BOH investors were disappointed as the stock returned 1.4% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published at Insider Monkey.
