Insider Monkey has processed numerous 13F filings of hedge funds and successful value investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds’ and successful investors’ positions as of the end of the third quarter. You can find articles about an individual hedge fund’s trades on numerous financial news websites. However, in this article we will take a look at their collective moves over the last 5 years and analyze what the smart money thinks of PCSB Financial Corporation (NASDAQ:PCSB) based on that data.
PCSB Financial Corporation (NASDAQ:PCSB) has experienced an increase in hedge fund sentiment of late. PCSB Financial Corporation (NASDAQ:PCSB) was in 11 hedge funds’ portfolios at the end of the third quarter of 2020. The all time high for this statistics is 11. This means the bullish number of hedge fund positions in this stock currently sits at its all time high. There were 9 hedge funds in our database with PCSB positions at the end of the second quarter. Our calculations also showed that PCSB 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.
David Harding of Winton Capital 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. Now let’s take a peek at the fresh hedge fund action regarding PCSB Financial Corporation (NASDAQ:PCSB).
Do Hedge Funds Think PCSB Is A Good Stock To Buy Now?
At the end of the third quarter, a total of 11 of the hedge funds tracked by Insider Monkey were long this stock, a change of 22% from one quarter earlier. By comparison, 9 hedge funds held shares or bullish call options in PCSB 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.
The largest stake in PCSB Financial Corporation (NASDAQ:PCSB) was held by Renaissance Technologies, which reported holding $6.8 million worth of stock at the end of September. It was followed by Royce & Associates with a $3.1 million position. Other investors bullish on the company included Prospector Partners, Arrowstreet Capital, and Winton Capital Management. In terms of the portfolio weights assigned to each position Prospector Partners allocated the biggest weight to PCSB Financial Corporation (NASDAQ:PCSB), around 0.35% of its 13F portfolio. Ancora Advisors is also relatively very bullish on the stock, dishing out 0.04 percent of its 13F equity portfolio to PCSB.
As one would reasonably expect, key money managers were breaking ground themselves. Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, assembled the most outsized position in PCSB Financial Corporation (NASDAQ:PCSB). Arrowstreet Capital had $1.4 million invested in the company at the end of the quarter. D. E. Shaw’s D E Shaw also initiated a $0.4 million position during the quarter. The only other fund with a new position in the stock is Paul Marshall and Ian Wace’s Marshall Wace LLP.
Let’s go over hedge fund activity in other stocks similar to PCSB Financial Corporation (NASDAQ:PCSB). We will take a look at Rayonier Advanced Materials Inc (NYSE:RYAM), Park-Ohio Holdings Corp. (NASDAQ:PKOH), Solar Senior Capital Ltd (NASDAQ:SUNS), DZS Inc. (NASDAQ:DZSI), Ceragon Networks Ltd. (NASDAQ:CRNT), iCAD Inc (NASDAQ:ICAD), and T2 Biosystems Inc (NASDAQ:TTOO). This group of stocks’ market values are similar to PCSB’s market value.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| RYAM | 10 | 19326 | 0 |
| PKOH | 6 | 16550 | -2 |
| SUNS | 2 | 1073 | 0 |
| DZSI | 4 | 10546 | -2 |
| CRNT | 7 | 11308 | 0 |
| ICAD | 14 | 31633 | 2 |
| TTOO | 4 | 562 | 0 |
| Average | 6.7 | 13000 | -0.3 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 6.7 hedge funds with bullish positions and the average amount invested in these stocks was $13 million. That figure was $18 million in PCSB’s case. iCAD Inc (NASDAQ:ICAD) is the most popular stock in this table. On the other hand Solar Senior Capital Ltd (NASDAQ:SUNS) is the least popular one with only 2 bullish hedge fund positions. PCSB Financial Corporation (NASDAQ:PCSB) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for PCSB is 74.5. 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 gained 32.9% in 2020 through December 8th and still beat the market by 16.2 percentage points. Hedge funds were also right about betting on PCSB as the stock returned 34.6% since the end of Q3 (through 12/8) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
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Disclosure: None. This article was originally published at Insider Monkey.
