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Is First Financial Bankshares Inc (FFIN) A Good Stock To Buy?

Seeing as First Financial Bankshares Inc (NASDAQ:FFIN) has faced a declining sentiment from hedge fund managers, it’s easy to see that there was a specific group of funds who were dropping their full holdings in the third quarter. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital dumped the largest investment of the 700 funds tracked by Insider Monkey, totaling an estimated $0.8 million in stock, and Jim Simons’ Renaissance Technologies was right behind this move, as the fund dropped about $0.7 million worth of shares.

Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as First Financial Bankshares Inc (NASDAQ:FFIN) but similarly valued. We will take a look at Louisiana-Pacific Corporation (NYSE:LPX), Monolithic Power Systems, Inc. (NASDAQ:MPWR), Rowan Companies PLC (NYSE:RDC), and WESCO International, Inc. (NYSE:WCC). All of these stocks’ market caps match FFIN’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
LPX 20 327190 4
MPWR 16 220382 0
RDC 21 481508 -3
WCC 20 351076 -3

As you can see these stocks had an average of 19 hedge funds with bullish positions and the average amount invested in these stocks was $345 million. That figure was just $9 million in FFIN’s case. Rowan Companies PLC (NYSE:RDC) is the most popular stock in this table. On the other hand Monolithic Power Systems, Inc. (NASDAQ:MPWR) is the least popular one with only 16 bullish hedge fund positions. Compared to these stocks First Financial Bankshares Inc (NASDAQ:FFIN) is even less popular than MPWR. Considering that hedge funds aren’t fond of this stock in relation to other companies analyzed in this article, it may be a good idea to analyze it in detail and understand why the smart money isn’t behind this stock. This isn’t necessarily bad news. Although it is possible that hedge funds may think the stock is overpriced and view the stock as a short candidate, they may not be very familiar with the bullish thesis. In either case more research is warranted.

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