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Here’s What Hedge Funds Think About Heartland Financial USA Inc (HTLF)

Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 750 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds’ recent losses in Facebook. Let’s take a closer look at what the funds we track think about Heartland Financial USA Inc (NASDAQ:HTLF) in this article.

Heartland Financial USA Inc (NASDAQ:HTLF) shareholders have witnessed an increase in hedge fund sentiment lately. Our calculations also showed that HTLF isn’t among the 30 most popular stocks among hedge funds.

If you’d ask most stock holders, hedge funds are assumed to be slow, outdated investment vehicles of years past. While there are greater than 8000 funds with their doors open today, Our researchers hone in on the moguls of this group, approximately 750 funds. It is estimated that this group of investors handle most of all hedge funds’ total capital, and by following their matchless picks, Insider Monkey has revealed many investment strategies that have historically surpassed the market. Insider Monkey’s flagship hedge fund strategy surpassed the S&P 500 index by nearly 5 percentage points a year since its inception in May 2014 through early November 2018. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 27.5% since February 2017 (through March 12th) even though the market was up nearly 25% during the same period. We just shared a list of 6 short targets in our latest quarterly update and they are already down an average of 6% in less than a month.

John Overdeck of Two Sigma

Let’s take a gander at the new hedge fund action encompassing Heartland Financial USA Inc (NASDAQ:HTLF).

What does the smart money think about Heartland Financial USA Inc (NASDAQ:HTLF)?

At the end of the fourth quarter, a total of 7 of the hedge funds tracked by Insider Monkey were long this stock, a change of 17% from the previous quarter. The graph below displays the number of hedge funds with bullish position in HTLF over the last 14 quarters. With hedge funds’ capital changing hands, there exists a select group of noteworthy hedge fund managers who were adding to their stakes significantly (or already accumulated large positions).

HTLF_apr2019

More specifically, Renaissance Technologies was the largest shareholder of Heartland Financial USA Inc (NASDAQ:HTLF), with a stake worth $6.7 million reported as of the end of December. Trailing Renaissance Technologies was AQR Capital Management, which amassed a stake valued at $3.3 million. Two Sigma Advisors, Citadel Investment Group, and Millennium Management were also very fond of the stock, giving the stock large weights in their portfolios.

As one would reasonably expect, specific money managers have jumped into Heartland Financial USA Inc (NASDAQ:HTLF) headfirst. Citadel Investment Group, managed by Ken Griffin, assembled the most outsized position in Heartland Financial USA Inc (NASDAQ:HTLF). Citadel Investment Group had $0.7 million invested in the company at the end of the quarter. Israel Englander’s Millennium Management also made a $0.5 million investment in the stock during the quarter. The only other fund with a brand new HTLF position is Brandon Haley’s Holocene Advisors.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Heartland Financial USA Inc (NASDAQ:HTLF) but similarly valued. We will take a look at NBT Bancorp Inc. (NASDAQ:NBTB), The Gabelli Dividend & Income Trust (NYSE:GDV), Innospec Inc. (NASDAQ:IOSP), and Ameris Bancorp (NASDAQ:ABCB). All of these stocks’ market caps resemble HTLF’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
NBTB 9 7733 1
GDV 2 5135 -1
IOSP 14 52822 2
ABCB 18 120240 5
Average 10.75 46483 1.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 10.75 hedge funds with bullish positions and the average amount invested in these stocks was $46 million. That figure was $13 million in HTLF’s case. Ameris Bancorp (NASDAQ:ABCB) is the most popular stock in this table. On the other hand The Gabelli Dividend & Income Trust (NYSE:GDV) is the least popular one with only 2 bullish hedge fund positions. Heartland Financial USA Inc (NASDAQ:HTLF) 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 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. Unfortunately HTLF wasn’t nearly as popular as these 15 stock (hedge fund sentiment was quite bearish); HTLF investors were disappointed as the stock returned 3% and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 15 most popular stocks) among hedge funds as 13 of these stocks already outperformed the market this year.

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

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