Astoria Financial Corp (NYSE:AF) was in 14 hedge funds’ portfolio at the end of the fourth quarter of 2012. AF has experienced an increase in hedge fund sentiment of late. There were 7 hedge funds in our database with AF positions at the end of the previous quarter.
In the financial world, there are tons of gauges investors can use to track the equity markets. A pair of the most useful are hedge fund and insider trading interest. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the elite hedge fund managers can outclass the S&P 500 by a very impressive amount (see just how much).
Just as important, bullish insider trading sentiment is another way to parse down the investments you’re interested in. There are a variety of incentives for an upper level exec to sell shares of his or her company, but only one, very clear reason why they would buy. Several empirical studies have demonstrated the market-beating potential of this strategy if investors know what to do (learn more here).
With all of this in mind, we’re going to take a look at the recent action surrounding Astoria Financial Corp (NYSE:AF).
How have hedgies been trading Astoria Financial Corp (NYSE:AF)?
In preparation for this year, a total of 14 of the hedge funds we track were long in this stock, a change of 100% from one quarter earlier. With the smart money’s sentiment swirling, there exists a select group of notable hedge fund managers who were increasing their stakes meaningfully.
Of the funds we track, Polaris Capital Management, managed by Bernard Horn, holds the most valuable position in Astoria Financial Corp (NYSE:AF). Polaris Capital Management has a $31 million position in the stock, comprising 2.2% of its 13F portfolio. Coming in second is Citadel Investment Group, managed by Ken Griffin, which held a $11 million position; the fund has 0% of its 13F portfolio invested in the stock. Remaining hedgies that are bullish include Matthew Lindenbaum’s Basswood Capital, Brian Taylor’s Pine River Capital Management and Anil Stevens and Glenn Shapiro’s Parameter Capital Management.
As one would reasonably expect, key money managers were leading the bulls’ herd. Pine River Capital Management, managed by Brian Taylor, created the largest position in Astoria Financial Corp (NYSE:AF). Pine River Capital Management had 7 million invested in the company at the end of the quarter. Anil Stevens and Glenn Shapiro’s Parameter Capital Management also made a $3 million investment in the stock during the quarter. The other funds with brand new AF positions are Israel Englander’s Millennium Management, Ken Gray and Steve Walsh’s Bryn Mawr Capital, and Israel Englander’s Catapult Capital Management.
What have insiders been doing with Astoria Financial Corp (NYSE:AF)?
Bullish insider trading is at its handiest when the primary stock in question has seen transactions within the past 180 days. Over the latest six-month time period, Astoria Financial Corp (NYSE:AF) has seen 1 unique insiders buying, and 3 insider sales (see the details of insider trades here).
Let’s also examine hedge fund and insider activity in other stocks similar to Astoria Financial Corp (NYSE:AF). These stocks are Sterling Financial Corporation (NASDAQ:STSA), Flagstar Bancorp Inc (NYSE:FBC), Northwest Bancshares, Inc. (NASDAQ:NWBI), Columbia Banking System Inc (NASDAQ:COLB), and Provident Financial Services, Inc. (NYSE:PFS). All of these stocks are in the savings & loans industry and their market caps are closest to AF’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Sterling Financial Corporation (NASDAQ:STSA)||8||0||0|
|Flagstar Bancorp Inc (NYSE:FBC)||14||1||0|
|Northwest Bancshares, Inc. (NASDAQ:NWBI)||6||1||2|
|Columbia Banking System Inc (NASDAQ:COLB)||7||2||1|
|Provident Financial Services, Inc. (NYSE:PFS)||6||3||1|
With the returns shown by the aforementioned tactics, everyday investors must always monitor hedge fund and insider trading activity, and Astoria Financial Corp (NYSE:AF) applies perfectly to this mantra.
Insider Monkey’s small-cap strategy returned 37% between September 2012 and March 2013 versus 12.9% for the S&P 500 index. Try it now by clicking the link above.