The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 817 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of September 30th, about a month before the elections. In this article we look at what those investors think of First Bancorp (NYSE:FBP).
Is FBP a good stock to buy now? First Bancorp (NYSE:FBP) investors should pay attention to a decrease in hedge fund sentiment of late. First Bancorp (NYSE:FBP) was in 21 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistic is 32. There were 26 hedge funds in our database with FBP holdings at the end of June. Our calculations also showed that FBP isn’t among the 30 most popular stocks among hedge funds (click for Q3 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that a select group of hedge fund holdings outperformed the S&P 500 ETFs by 66 percentage points since March 2017 (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 13% through November 17th. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Steven Cohen of Point72 Asset Management
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Keeping this in mind let’s view the new hedge fund action surrounding First Bancorp (NYSE:FBP).
Do Hedge Funds Think FBP Is A Good Stock To Buy Now?
Heading into the fourth quarter of 2020, a total of 21 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -19% from one quarter earlier. By comparison, 21 hedge funds held shares or bullish call options in FBP 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.
More specifically, Point72 Asset Management was the largest shareholder of First Bancorp (NYSE:FBP), with a stake worth $29.1 million reported as of the end of September. Trailing Point72 Asset Management was Alyeska Investment Group, which amassed a stake valued at $20.9 million. D E Shaw, Arrowstreet Capital, and Two Sigma Advisors were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Mendon Capital Advisors allocated the biggest weight to First Bancorp (NYSE:FBP), around 3.55% of its 13F portfolio. Invenomic Capital Management is also relatively very bullish on the stock, designating 1.45 percent of its 13F equity portfolio to FBP.
Since First Bancorp (NYSE:FBP) has experienced falling interest from hedge fund managers, it’s safe to say that there exists a select few fund managers that slashed their full holdings in the third quarter. Intriguingly, Paul Magidson, Jonathan Cohen. And Ostrom Enders’s Castine Capital Management said goodbye to the biggest stake of all the hedgies followed by Insider Monkey, totaling an estimated $7.3 million in stock, and David Harding’s Winton Capital Management was right behind this move, as the fund cut about $0.7 million worth. These moves are important to note, as total hedge fund interest was cut by 5 funds in the third quarter.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as First Bancorp (NYSE:FBP) but similarly valued. We will take a look at CSW Industrials, Inc. (NASDAQ:CSWI), Urban Edge Properties (NYSE:UE), Banner Corporation (NASDAQ:BANR), The Bank of N.T. Butterfield & Son Limited (NYSE:NTB), Repare Therapeutics Inc. (NASDAQ:RPTX), Tronox Holdings Plc (NYSE:TROX), and Enerpac Tool Group Corp. (NYSE:EPAC). This group of stocks’ market caps match FBP’s market cap.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| CSWI | 16 | 29403 | -3 |
| UE | 20 | 59441 | -5 |
| BANR | 14 | 41696 | 0 |
| NTB | 15 | 56385 | 0 |
| RPTX | 15 | 359949 | -2 |
| TROX | 19 | 69798 | -2 |
| EPAC | 11 | 83786 | -7 |
| Average | 15.7 | 100065 | -2.7 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 15.7 hedge funds with bullish positions and the average amount invested in these stocks was $100 million. That figure was $111 million in FBP’s case. Urban Edge Properties (NYSE:UE) is the most popular stock in this table. On the other hand Enerpac Tool Group Corp. (NYSE:EPAC) is the least popular one with only 11 bullish hedge fund positions. Compared to these stocks First Bancorp (NYSE:FBP) is more popular among hedge funds. Our overall hedge fund sentiment score for FBP is 69.7. 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 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks returned 30.7% in 2020 through December 14th but still managed to beat the market by 15.8 percentage points. Hedge funds were also right about betting on FBP as the stock returned 70.1% since the end of September (through 12/14) and outperformed the market by an even larger margin. Hedge funds were clearly right about piling into this stock relative to other stocks with similar market capitalizations.
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Disclosure: None. This article was originally published at Insider Monkey.
