Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Hedge Funds Are Crazy About Astoria Financial Corp (NYSE:AF) – Flagstar Bancorp Inc (NYSE:FBC), Provident Financial Services, Inc. (NYSE:PFS)

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.

Astoria Financial Corp (NYSE:AF)

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.

Click here to learn more about Insider Monkey’s Hedge Fund Newsletter

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.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.