We at Insider Monkey have gone over 821 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds’ and investors’ portfolio positions as of March 31st, near the height of the coronavirus market crash. In this article, we look at what those funds think of Community Trust Bancorp, Inc. (NASDAQ:CTBI) based on that data.
Community Trust Bancorp, Inc. (NASDAQ:CTBI) shares haven’t seen a lot of action during the first quarter. Overall, hedge fund sentiment was unchanged. The stock was in 6 hedge funds’ portfolios at the end of the first quarter of 2020. At the end of this article we will also compare CTBI to other stocks including Silvercorp Metals Inc. (NYSE:SVM), Bryn Mawr Bank Corp. (NASDAQ:BMTC), and Urstadt Biddle Properties Inc (NYSE:UBA) to get a better sense of its popularity.
Video: Watch our video about the top 5 most popular hedge fund stocks.
In the 21st century investor’s toolkit there are dozens of indicators investors use to assess publicly traded companies. Some of the most useful indicators are hedge fund and insider trading activity. Our researchers have shown that, historically, those who follow the top picks of the elite money managers can outclass their index-focused peers by a very impressive amount (see the details here).
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. Keeping this in mind let’s take a gander at the key hedge fund action regarding Community Trust Bancorp, Inc. (NASDAQ:CTBI).
How are hedge funds trading Community Trust Bancorp, Inc. (NASDAQ:CTBI)?
At Q1’s end, a total of 6 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 0% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards CTBI over the last 18 quarters. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Renaissance Technologies was the largest shareholder of Community Trust Bancorp, Inc. (NASDAQ:CTBI), with a stake worth $10.3 million reported as of the end of September. Trailing Renaissance Technologies was AQR Capital Management, which amassed a stake valued at $1 million. Winton Capital Management, Two Sigma Advisors, and Citadel Investment Group were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Zebra Capital Management allocated the biggest weight to Community Trust Bancorp, Inc. (NASDAQ:CTBI), around 0.66% of its 13F portfolio. Winton Capital Management is also relatively very bullish on the stock, setting aside 0.02 percent of its 13F equity portfolio to CTBI.
We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Millennium Management. One hedge fund selling its entire position doesn’t always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don’t think this is the case in this case because only one of the 800+ hedge funds tracked by Insider Monkey identified as a viable investment and initiated a position in the stock (that fund was Citadel Investment Group).
Let’s check out hedge fund activity in other stocks similar to Community Trust Bancorp, Inc. (NASDAQ:CTBI). These stocks are Silvercorp Metals Inc. (NYSE:SVM), Bryn Mawr Bank Corp. (NASDAQ:BMTC), Urstadt Biddle Properties Inc (NYSE:UBA), and NOW Inc (NYSE:DNOW). This group of stocks’ market caps match CTBI’s market cap.
|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 10.5 hedge funds with bullish positions and the average amount invested in these stocks was $36 million. That figure was $14 million in CTBI’s case. NOW Inc (NYSE:DNOW) is the most popular stock in this table. On the other hand Silvercorp Metals Inc. (NYSE:SVM) is the least popular one with only 5 bullish hedge fund positions. Community Trust Bancorp, Inc. (NASDAQ:CTBI) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. 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 and surpassed the market by 14.2 percentage points. Unfortunately CTBI wasn’t nearly as popular as these 10 stocks (hedge fund sentiment was quite bearish); CTBI investors were disappointed as the stock returned 7.7% during the second quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 10 most popular stocks among hedge funds as most of these stocks already outperformed the market in 2020.
Disclosure: None. This article was originally published at Insider Monkey.