The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. Insider Monkey finished processing 821 13F filings submitted by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of March 31st, 2020. In this article we are going to take a look at smart money sentiment towards Mid-Southern Bancorp, Inc. (NASDAQ:MSVB).
Mid-Southern Bancorp, Inc. (NASDAQ:MSVB) shares haven’t seen a lot of action during the first quarter. Overall, hedge fund sentiment was unchanged. The stock was in 4 hedge funds’ portfolios at the end of the first quarter of 2020. At the end of this article we will also compare MSVB to other stocks including Trxade Group, Inc. (NASDAQ:MEDS), 180 Degree Capital Corp. (NASDAQ:TURN), and Portman Ridge Finance Corporation (NASDAQ:PTMN) to get a better sense of its popularity.
Video: Watch our video about the top 5 most popular hedge fund stocks.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 51 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
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. With all of this in mind let’s take a glance at the recent hedge fund action encompassing Mid-Southern Bancorp, Inc. (NASDAQ:MSVB).
Hedge fund activity in Mid-Southern Bancorp, Inc. (NASDAQ:MSVB)
At the end of the first quarter, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a change of 0% from the previous quarter. The graph below displays the number of hedge funds with bullish position in MSVB over the last 18 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
When looking at the institutional investors followed by Insider Monkey, Seidman Investment Partnership, managed by Lawrence Seidman, holds the largest position in Mid-Southern Bancorp, Inc. (NASDAQ:MSVB). Seidman Investment Partnership has a $2.2 million position in the stock, comprising 2.7% of its 13F portfolio. The second most bullish fund manager is MFP Investors, managed by Michael Price, which holds a $2.2 million position; the fund has 0.4% of its 13F portfolio invested in the stock. Some other professional money managers with similar optimism include Austin Wiggins Hopper’s AWH Capital, David P. Cohen’s Minerva Advisors and . In terms of the portfolio weights assigned to each position AWH Capital allocated the biggest weight to Mid-Southern Bancorp, Inc. (NASDAQ:MSVB), around 3.16% of its 13F portfolio. Seidman Investment Partnership is also relatively very bullish on the stock, setting aside 2.71 percent of its 13F equity portfolio to MSVB.
Earlier we told you that the aggregate hedge fund interest in the stock was unchanged and we view this as a negative development. Even though there weren’t any hedge funds dumping their holdings during the third quarter, there weren’t any hedge funds initiating brand new positions. This indicates that hedge funds, at the very best, perceive this stock as dead money and they haven’t identified any viable catalysts that can attract investor attention.
Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as Mid-Southern Bancorp, Inc. (NASDAQ:MSVB) but similarly valued. We will take a look at Trxade Group, Inc. (NASDAQ:MEDS), 180 Degree Capital Corp. (NASDAQ:TURN), Portman Ridge Finance Corporation (NASDAQ:PTMN), and TESSCO Technologies, Inc. (NASDAQ:TESS). This group of stocks’ market caps are similar to MSVB’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 3.5 hedge funds with bullish positions and the average amount invested in these stocks was $3 million. That figure was $5 million in MSVB’s case. Portman Ridge Finance Corporation (NASDAQ:PTMN) is the most popular stock in this table. On the other hand Trxade Group, Inc. (NASDAQ:MEDS) is the least popular one with only 1 bullish hedge fund positions. Mid-Southern Bancorp, Inc. (NASDAQ:MSVB) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but 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 8.3% in 2020 through the end of May but beat the market by 13.2 percentage points. Unfortunately MSVB wasn’t nearly as popular as these 10 stocks and hedge funds that were betting on MSVB were disappointed as the stock returned 1.3% during the same time period 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 many of these stocks already outperformed the market so far this year.
Disclosure: None. This article was originally published at Insider Monkey.