There are several ways to beat the market, and investing in small cap stocks has historically been one of them. We like to improve the odds of beating the market further by examining what famous hedge fund operators such as Carl Icahn and George Soros think. Those hedge fund operators make billions of dollars each year by hiring the best and the brightest to do research on stocks, including small cap stocks that big brokerage houses simply don’t cover. Because of Carl Icahn and other elite funds’ exemplary historical records, we pay attention to their small cap picks. In this article, we use hedge fund filing data to analyze First Financial Bankshares Inc (NASDAQ:FFIN).
Is First Financial Bankshares Inc (NASDAQ:FFIN) a safe stock to buy now? The investors from our database seem to be not very confident in the stock and amid an 8% drop in the third quarter, the number of funds with long positions declined by three to five. However, the level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity, but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Louisiana-Pacific Corporation (NYSE:LPX), Monolithic Power Systems, Inc. (NASDAQ:MPWR), and Rowan Companies PLC (NYSE:RDC) to gather more data points.
In the 21st century investor’s toolkit there are a multitude of methods that stock traders put to use to size up publicly traded companies. Two of the less known methods are hedge fund and insider trading interest. We have shown that, historically, those who follow the top picks of the best money managers can beat the S&P 500 by a very impressive amount (see the details here).
Now, we’re going to take a look at the new action encompassing First Financial Bankshares Inc (NASDAQ:FFIN).
What have hedge funds been doing with First Financial Bankshares Inc (NASDAQ:FFIN)?
As stated earlier, at the end of the third quarter, a total of 5 of the hedge funds tracked by Insider Monkey were bullish on this stock, a drop of 38% from one quarter earlier. With hedge funds’ sentiment swirling, there exists a select group of noteworthy hedge fund managers who were upping their stakes considerably (or already accumulated large positions).
When looking at the institutional investors followed by Insider Monkey, Sharif Siddiqui’s Alpenglow Capital has the largest position in First Financial Bankshares Inc (NASDAQ:FFIN), worth close to $3.7 million, corresponding to 3.1% of its total 13F portfolio. Sitting at the No. 2 spot is Citadel Investment Group, managed by Ken Griffin, which holds a $3.1 million position; less than 0.1% of its 13F portfolio is allocated to the stock. Remaining professional money managers with similar optimism comprise D. E. Shaw’s D E Shaw, Paul Marshall and Ian Wace’s Marshall Wace LLP, and Peter Muller’s PDT Partners.