HomeStreet Inc (NASDAQ:HMST) investors should pay attention to an increase in support from the world’s most elite money managers in recent months.
To the average investor, there are tons of gauges investors can use to analyze Mr. Market. A duo of the best are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top money managers can outpace their index-focused peers by a healthy amount (see just how much).
Just as key, positive insider trading sentiment is another way to break down the world of equities. Just as you’d expect, there are plenty of motivations for an insider to cut shares of his or her company, but just one, very clear reason why they would buy. Various empirical studies have demonstrated the useful potential of this method if piggybackers understand what to do (learn more here).
Now, we’re going to take a look at the latest action surrounding HomeStreet Inc (NASDAQ:HMST).
What does the smart money think about HomeStreet Inc (NASDAQ:HMST)?
In preparation for this year, a total of 7 of the hedge funds we track were bullish in this stock, a change of 40% from the previous quarter. With hedge funds’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were increasing their stakes significantly.
According to our comprehensive database, Trafelet Capital, managed by Remy Trafelet, holds the most valuable position in HomeStreet Inc (NASDAQ:HMST). Trafelet Capital has a $18.4 million position in the stock, comprising 13% of its 13F portfolio. The second largest stake is held by Amy Minella of Cardinal Capital, with a $10.5 million position; the fund has 0.7% of its 13F portfolio invested in the stock. Some other peers that are bullish include Matthew Halbower’s Pentwater Capital Management, Charles Davidson’s Wexford Capital and Steven Owsley’s Madison Street Partners.
Consequently, key money managers have been driving this bullishness. Wexford Capital, managed by Charles Davidson, assembled the biggest position in HomeStreet Inc (NASDAQ:HMST). Wexford Capital had 6.4 million invested in the company at the end of the quarter. Jim Simons’s Renaissance Technologies also made a $1.3 million investment in the stock during the quarter. The only other fund with a brand new HMST position is Mike Vranos’s Ellington.
How are insiders trading HomeStreet Inc (NASDAQ:HMST)?
Insider trading activity, especially when it’s bullish, is most useful when the primary stock in question has seen transactions within the past six months. Over the latest six-month time period, HomeStreet Inc (NASDAQ:HMST) has experienced 2 unique insiders purchasing, and 4 insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to HomeStreet Inc (NASDAQ:HMST). These stocks are Waterstone Financial, Inc. (NASDAQ:WSBF), Rockville Financial Inc (NASDAQ:RCKB), First Financial Holdings, Inc. (NASDAQ:FFCH), United Financial Bancorp, Inc. (NASDAQ:UBNK), and Clifton Savings Bancorp, Inc. (NASDAQ:CSBK). This group of stocks are in the savings & loans industry and their market caps are closest to HMST’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| Waterstone Financial, Inc. (NASDAQ:WSBF) | 1 | 1 | 1 |
| Rockville Financial Inc (NASDAQ:RCKB) | 5 | 3 | 1 |
| First Financial Holdings, Inc. (NASDAQ:FFCH) | 10 | 1 | 0 |
| United Financial Bancorp, Inc. (NASDAQ:UBNK) | 5 | 1 | 0 |
| Clifton Savings Bancorp, Inc. (NASDAQ:CSBK) | 2 | 0 | 1 |
With the returns shown by the aforementioned research, everyday investors must always pay attention to hedge fund and insider trading sentiment, and HomeStreet Inc (NASDAQ:HMST) shareholders fit into this picture quite nicely.
