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.

Here’s What Hedge Funds Think About Bank of Hawaii Corporation (BOH)

It seems that the masses and most of the financial media hate hedge funds and what they do, but why is this hatred of hedge funds so prominent? At the end of the day, these asset management firms do not gamble the hard-earned money of the people who are on the edge of poverty. Truth be told, most hedge fund managers and other smaller players within this industry are very smart and skilled investors. Of course, they may also make wrong bets in some instances, but no one knows what the future holds and how market participants will react to the bountiful news that floods in each day. The Standard and Poor’s 500 Index returned approximately 13.1% in the first 2.5 months of this year (including dividend payments). Conversely, hedge funds’ top 15 large-cap stock picks generated a return of 19.7% during the same 2.5-month period, with 93% of these stock picks outperforming the broader market benchmark. Coincidence? It might happen to be so, but it is unlikely. Our research covering the last 18 years indicates that hedge funds’ stock picks generate superior risk-adjusted returns. That’s why we believe it isn’t a waste of time to check out hedge fund sentiment before you invest in a stock like Bank of Hawaii Corporation (NYSE:BOH).

Is Bank of Hawaii Corporation (NYSE:BOH) the right investment to pursue these days? The best stock pickers are taking a bullish view. The number of bullish hedge fund positions improved by 1 recently. Our calculations also showed that BOH isn’t among the 30 most popular stocks among hedge funds.

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’ large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that’ll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 27.5% through March 12, 2019. That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.

BlueMountain Capital Management's Returns, AUM and Holdings

Let’s view the latest hedge fund action surrounding Bank of Hawaii Corporation (NYSE:BOH).

How have hedgies been trading Bank of Hawaii Corporation (NYSE:BOH)?

Heading into the first quarter of 2019, a total of 13 of the hedge funds tracked by Insider Monkey were long this stock, a change of 8% from one quarter earlier. By comparison, 8 hedge funds held shares or bullish call options in BOH a year ago. With hedgies’ capital changing hands, there exists a few key hedge fund managers who were increasing their stakes substantially (or already accumulated large positions).

BOH_apr2019

More specifically, Renaissance Technologies was the largest shareholder of Bank of Hawaii Corporation (NYSE:BOH), with a stake worth $31.7 million reported as of the end of September. Trailing Renaissance Technologies was Balyasny Asset Management, which amassed a stake valued at $27.8 million. Royce & Associates, Citadel Investment Group, and AQR Capital Management were also very fond of the stock, giving the stock large weights in their portfolios.

Consequently, key hedge funds were breaking ground themselves. Interval Partners, managed by Gregg Moskowitz, initiated the biggest position in Bank of Hawaii Corporation (NYSE:BOH). Interval Partners had $1 million invested in the company at the end of the quarter. D. E. Shaw’s D E Shaw also made a $0.6 million investment in the stock during the quarter. The other funds with new positions in the stock are Matthew Hulsizer’s PEAK6 Capital Management and Andrew Feldstein and Stephen Siderow’s Blue Mountain Capital.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as Bank of Hawaii Corporation (NYSE:BOH) but similarly valued. These stocks are Eldorado Resorts Inc (NASDAQ:ERI), Magnolia Oil & Gas Corporation (NYSE:MGY), The Boston Beer Company Inc (NYSE:SAM), and Avista Corp (NYSE:AVA). All of these stocks’ market caps resemble BOH’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
ERI 29 492002 5
MGY 32 264461 -5
SAM 19 266550 5
AVA 18 265879 1
Average 24.5 322223 1.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 24.5 hedge funds with bullish positions and the average amount invested in these stocks was $322 million. That figure was $102 million in BOH’s case. Magnolia Oil & Gas Corporation (NYSE:MGY) is the most popular stock in this table. On the other hand Avista Corp (NYSE:AVA) is the least popular one with only 18 bullish hedge fund positions. Compared to these stocks Bank of Hawaii Corporation (NYSE:BOH) is even less popular than AVA. Our calculations showed that top 15 most popular stocks) among hedge funds returned 24.2% through April 22nd and outperformed the S&P 500 ETF (SPY) by more than 7 percentage points. A small number of hedge funds were also right about betting on BOH, though not to the same extent, as the stock returned 21.7% and outperformed the market as well.

Disclosure: None. This article was originally published at Insider Monkey.

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.
Loading...