After several tireless days we have finished crunching the numbers from nearly 900 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms’ equity portfolios as of June 30th. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Peoples Bancorp Inc. (NASDAQ:PEBO).
Is PEBO a good stock to buy? The best stock pickers were getting more bullish. The number of long hedge fund bets increased by 5 recently. Peoples Bancorp Inc. (NASDAQ:PEBO) was in 10 hedge funds’ portfolios at the end of the second quarter of 2021. The all time high for this statistic is 11. Our calculations also showed that PEBO isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings). There were 5 hedge funds in our database with PEBO positions at the end of the first quarter.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. 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 S&P 500 ETFs by 79 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 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.
Fred Cummings of Elizabeth Park Capital
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 10 best EV 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 let’s take a glance at the latest hedge fund action surrounding Peoples Bancorp Inc. (NASDAQ:PEBO).
Do Hedge Funds Think PEBO Is A Good Stock To Buy Now?
At the end of June, a total of 10 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 100% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in PEBO over the last 24 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey, Emanuel J. Friedman’s EJF Capital has the biggest position in Peoples Bancorp Inc. (NASDAQ:PEBO), worth close to $4.2 million, corresponding to 0.4% of its total 13F portfolio. Coming in second is Fred Cummings of Elizabeth Park Capital Management, with a $4.1 million position; the fund has 1.6% of its 13F portfolio invested in the stock. Remaining members of the smart money with similar optimism encompass Renaissance Technologies, Ken Griffin’s Citadel Investment Group and John Overdeck and David Siegel’s Two Sigma Advisors. In terms of the portfolio weights assigned to each position Elizabeth Park Capital Management allocated the biggest weight to Peoples Bancorp Inc. (NASDAQ:PEBO), around 1.55% of its 13F portfolio. EJF Capital is also relatively very bullish on the stock, designating 0.38 percent of its 13F equity portfolio to PEBO.
As aggregate interest increased, specific money managers were leading the bulls’ herd. EJF Capital, managed by Emanuel J. Friedman, created the most outsized position in Peoples Bancorp Inc. (NASDAQ:PEBO). EJF Capital had $4.2 million invested in the company at the end of the quarter. Fred Cummings’s Elizabeth Park Capital Management also made a $4.1 million investment in the stock during the quarter. The other funds with brand new PEBO positions are Gavin Saitowitz and Cisco J. del Valle’s Prelude Capital (previously Springbok Capital) and Cliff Asness’s AQR Capital Management.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Peoples Bancorp Inc. (NASDAQ:PEBO) but similarly valued. We will take a look at International Money Express, Inc. (NASDAQ:IMXI), Dorian LPG Ltd (NYSE:LPG), Eros STX Global Corporation (NYSE:ESGC), Brightcove Inc (NASDAQ:BCOV), Triterras, Inc. (NASDAQ:TRIT), Verso Corporation (NYSE:VRS), and Cambridge Bancorp (NASDAQ:CATC). This group of stocks’ market valuations match PEBO’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| IMXI | 15 | 97723 | -3 |
| LPG | 19 | 97060 | 1 |
| ESGC | 10 | 24837 | -4 |
| BCOV | 16 | 199892 | -5 |
| TRIT | 10 | 16981 | -2 |
| VRS | 17 | 68479 | 2 |
| CATC | 6 | 20427 | 1 |
| Average | 13.3 | 75057 | -1.4 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 13.3 hedge funds with bullish positions and the average amount invested in these stocks was $75 million. That figure was $21 million in PEBO’s case. Dorian LPG Ltd (NYSE:LPG) is the most popular stock in this table. On the other hand Cambridge Bancorp (NASDAQ:CATC) is the least popular one with only 6 bullish hedge fund positions. Peoples Bancorp Inc. (NASDAQ:PEBO) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for PEBO is 52.7. 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 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 25.7% in 2021 through September 27th and still beat the market by 6.2 percentage points. A small number of hedge funds were also right about betting on PEBO as the stock returned 11.1% since the end of the second quarter (through 9/27) and outperformed the market by an even larger margin.
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Disclosure: None. This article was originally published at Insider Monkey.
