In this article we will check out the progression of hedge fund sentiment towards Republic First Bancorp, Inc. (NASDAQ:FRBK) and determine whether it is a good investment right now. We at Insider Monkey like to examine what billionaires and hedge funds think of a company before spending days of research on it. Given their 2 and 20 payment structure, hedge funds have more incentives and resources than the average investor. The funds have access to expert networks and get tips from industry insiders. They also employ numerous Ivy League graduates and MBAs. Like everyone else, hedge funds perform miserably at times, but their consensus picks have historically outperformed the market after risk adjustments.
Is Republic First Bancorp, Inc. (NASDAQ:FRBK) worth your attention right now? Investors who are in the know are turning bullish. The number of long hedge fund positions rose by 1 recently. Our calculations also showed that FRBK isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks). FRBK was in 7 hedge funds’ portfolios at the end of March. There were 6 hedge funds in our database with FRBK holdings at the end of the previous quarter.
Video: Watch our video about the top 5 most popular hedge fund stocks.
In the eyes of most traders, hedge funds are seen as worthless, outdated investment tools of the past. While there are greater than 8000 funds with their doors open at the moment, Our researchers hone in on the elite of this club, about 850 funds. It is estimated that this group of investors oversee most of the hedge fund industry’s total asset base, and by monitoring their matchless equity investments, Insider Monkey has revealed numerous investment strategies that have historically outrun Mr. Market. Insider Monkey’s flagship short hedge fund strategy outpaced the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now we’re going to take a peek at the new hedge fund action surrounding Republic First Bancorp, Inc. (NASDAQ:FRBK).
What have hedge funds been doing with Republic First Bancorp, Inc. (NASDAQ:FRBK)?
At the end of the first quarter, a total of 7 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 17% from the previous quarter. On the other hand, there were a total of 6 hedge funds with a bullish position in FRBK a year ago. With the smart money’s positions undergoing their usual ebb and flow, there exists a select group of notable hedge fund managers who were upping their stakes substantially (or already accumulated large positions).
The largest stake in Republic First Bancorp, Inc. (NASDAQ:FRBK) was held by Renaissance Technologies, which reported holding $2 million worth of stock at the end of September. It was followed by Citadel Investment Group with a $0.6 million position. Other investors bullish on the company included D E Shaw, Two Sigma Advisors, and Bailard Inc. In terms of the portfolio weights assigned to each position Bailard Inc allocated the biggest weight to Republic First Bancorp, Inc. (NASDAQ:FRBK), around 0.01% of its 13F portfolio. Renaissance Technologies is also relatively very bullish on the stock, designating 0.002 percent of its 13F equity portfolio to FRBK.
As one would reasonably expect, some big names were breaking ground themselves. Bailard Inc, managed by Thomas Bailard, created the most valuable position in Republic First Bancorp, Inc. (NASDAQ:FRBK). Bailard Inc had $0.1 million invested in the company at the end of the quarter. Philippe Laffont’s Coatue Management also made a $0 million investment in the stock during the quarter.
Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Republic First Bancorp, Inc. (NASDAQ:FRBK) but similarly valued. We will take a look at VolitionRX Limited (NYSE:VNRX), Graham Corporation (NYSE:GHM), Unity Bancorp, Inc. (NASDAQ:UNTY), and Veritiv Corp (NYSE:VRTV). This group of stocks’ market values resemble FRBK’s market value.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 5.75 hedge funds with bullish positions and the average amount invested in these stocks was $14 million. That figure was $3 million in FRBK’s case. Veritiv Corp (NYSE:VRTV) is the most popular stock in this table. On the other hand VolitionRX Limited (NYSE:VNRX) is the least popular one with only 1 bullish hedge fund positions. Republic First Bancorp, Inc. (NASDAQ:FRBK) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.9% in 2020 through June 10th but still beat the market by 14.2 percentage points. Hedge funds were also right about betting on FRBK, though not to the same extent, as the stock returned 24.7% during the first two months and ten days of the second quarter and outperformed the market as well.
Disclosure: None. This article was originally published at Insider Monkey.