Is FFBW A Good Stock To Buy Now?

Is FFBW, Inc. (NASDAQ:FFBW) a good place to invest some of your money right now? We can gain invaluable insight to help us answer that question by studying the investment trends of top investors, who employ world-class Ivy League graduates, who are given immense resources and industry contacts to put their financial expertise to work. The top picks of these firms have historically outperformed the market when we account for known risk factors, making them very valuable investment ideas.

Is FFBW a good stock to buy? Hedge fund interest in FFBW, Inc. (NASDAQ:FFBW) shares was flat at the end of last quarter. This is usually a negative indicator. Our calculations also showed that FFBW isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings). At the end of this article we will also compare FFBW to other stocks including Odyssey Marine Exploration Inc (NASDAQ:OMEX), Cleveland BioLabs, Inc. (NASDAQ:CBLI), and AMREP Corporation (NYSE:AXR) to get a better sense of its popularity.

Today there are a lot of formulas stock traders use to size up their holdings. A duo of the most under-the-radar formulas are hedge fund and insider trading signals. Our experts have shown that, historically, those who follow the top picks of the top money managers can outperform their index-focused peers by a significant margin (see the details here). Also, our monthly newsletter’s portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .

Michael Price of MFP Investors

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, an activist hedge fund wants to buy this $26 biotech stock for $50. So, we recommended a long position to our monthly premium newsletter subscribers. We go through lists like the 10 best battery 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. 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 homepage. Now we’re going to review the fresh hedge fund action surrounding FFBW, Inc. (NASDAQ:FFBW).

Do Hedge Funds Think FFBW Is A Good Stock To Buy Now?

At first quarter’s end, a total of 3 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards FFBW over the last 23 quarters. With hedge funds’ positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were upping their holdings considerably (or already accumulated large positions).

The largest stake in FFBW, Inc. (NASDAQ:FFBW) was held by MFP Investors, which reported holding $3.3 million worth of stock at the end of December. It was followed by Renaissance Technologies with a $0.6 million position. The only other hedge fund that is bullish on the company was Millennium Management.

Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.

Let’s also examine hedge fund activity in other stocks similar to FFBW, Inc. (NASDAQ:FFBW). These stocks are Odyssey Marine Exploration Inc (NASDAQ:OMEX), Cleveland BioLabs, Inc. (NASDAQ:CBLI), AMREP Corporation (NYSE:AXR), Fauquier Bankshares, Inc. (NASDAQ:FBSS), Synalloy Corporation (NASDAQ:SYNL), Cellectar Biosciences, Inc. (NASDAQ:CLRB), and LightPath Technologies, Inc. (NASDAQ:LPTH). All of these stocks’ market caps match FFBW’s market cap.

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As you can see these stocks had an average of 3.6 hedge funds with bullish positions and the average amount invested in these stocks was $7 million. That figure was $4 million in FFBW’s case. Cellectar Biosciences, Inc. (NASDAQ:CLRB) is the most popular stock in this table. On the other hand Odyssey Marine Exploration Inc (NASDAQ:OMEX) is the least popular one with only 2 bullish hedge fund positions. FFBW, Inc. (NASDAQ:FFBW) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for FFBW is 43.3. 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. 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 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 17.2% in 2021 through June 11th and surpassed the market again by 3.3 percentage points. Unfortunately FFBW wasn’t nearly as popular as these 5 stocks (hedge fund sentiment was quite bearish); FFBW investors were disappointed as the stock returned 0.1% since the end of March (through 6/11) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2021.

Disclosure: None. This article was originally published at Insider Monkey.