The financial regulations require hedge funds and wealthy investors that exceeded the $100 million equity holdings threshold to file a report that shows their positions at the end of every quarter. Even though it isn’t the intention, these filings to a certain extent level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds’ positions on March 31st, about a week after the S&P 500 Index bottomed. We at Insider Monkey have made an extensive database of more than 821 of those established hedge funds and famous value investors’ filings. In this article, we analyze how these elite funds and prominent investors traded The Bank of Princeton (NASDAQ:BPRN) based on those filings.
Is The Bank of Princeton (NASDAQ:BPRN) a safe stock to buy now? Money managers are taking an optimistic view. The number of long hedge fund bets advanced by 1 lately. Our calculations also showed that BPRN isn’t among the 30 most popular stocks among hedge funds (click for Q1 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.
According to most market participants, hedge funds are assumed to be underperforming, old investment tools of yesteryear. While there are more than 8000 funds trading today, Our researchers look at the top tier of this group, about 850 funds. Most estimates calculate that this group of people preside over the majority of the hedge fund industry’s total asset base, and by tracking their first-class picks, Insider Monkey has unearthed a few investment strategies that have historically exceeded Mr. Market. Insider Monkey’s flagship short hedge fund strategy exceeded the S&P 500 short ETFs by around 20 percentage points per year since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
Jim Simons of Renaissance Technologies
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, legendary investor Bill Miller told investors to sell 7 extremely popular recession stocks last month. So, we went through his list and recommended another stock with 100% upside potential instead. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Keeping this in mind we’re going to take a look at the latest hedge fund action encompassing The Bank of Princeton (NASDAQ:BPRN).
What have hedge funds been doing with The Bank of Princeton (NASDAQ:BPRN)?
At the end of the first quarter, a total of 3 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 50% from the fourth quarter of 2019. Below, you can check out the change in hedge fund sentiment towards BPRN over the last 18 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, EJF Capital was the largest shareholder of The Bank of Princeton (NASDAQ:BPRN), with a stake worth $9.9 million reported as of the end of September. Trailing EJF Capital was Renaissance Technologies, which amassed a stake valued at $1.3 million. Fourthstone LLC was 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 EJF Capital allocated the biggest weight to The Bank of Princeton (NASDAQ:BPRN), around 2.08% of its 13F portfolio. Fourthstone LLC is also relatively very bullish on the stock, designating 0.31 percent of its 13F equity portfolio to BPRN.
As industrywide interest jumped, some big names have jumped into The Bank of Princeton (NASDAQ:BPRN) headfirst. Fourthstone LLC, managed by Phil Stone, assembled the most outsized position in The Bank of Princeton (NASDAQ:BPRN). Fourthstone LLC had $0.3 million invested in the company at the end of the quarter.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as The Bank of Princeton (NASDAQ:BPRN) but similarly valued. These stocks are scPharmaceuticals Inc. (NASDAQ:SCPH), Alpha Pro Tech, Ltd. (NYSE:APT), Liminal BioSciences Inc. (NASDAQ:LMNL), and ESSA Bancorp, Inc. (NASDAQ:ESSA). This group of stocks’ market valuations are closest to BPRN’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| SCPH | 6 | 61882 | 1 |
| APT | 5 | 15095 | 3 |
| LMNL | 1 | 21980 | 0 |
| ESSA | 2 | 9991 | -1 |
| Average | 3.5 | 27237 | 0.75 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 3.5 hedge funds with bullish positions and the average amount invested in these stocks was $27 million. That figure was $12 million in BPRN’s case. scPharmaceuticals Inc. (NASDAQ:SCPH) is the most popular stock in this table. On the other hand Liminal BioSciences Inc. (NASDAQ:LMNL) is the least popular one with only 1 bullish hedge fund positions. The Bank of Princeton (NASDAQ:BPRN) 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 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 7.9% in 2020 through May 22nd and surpassed the market by 15.6 percentage points. Unfortunately BPRN wasn’t nearly as popular as these 10 stocks (hedge fund sentiment was quite bearish); BPRN investors were disappointed as the stock returned -12.9% during the second quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
Disclosure: None. This article was originally published at Insider Monkey.
