A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended September 30, so let’s proceed with the discussion of the hedge fund sentiment on First Foundation Inc (NASDAQ:FFWM).
First Foundation Inc (NASDAQ:FFWM) has seen a decrease in hedge fund sentiment recently. FFWM was in 7 hedge funds’ portfolios at the end of September. There were 11 hedge funds in our database with FFWM holdings at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That’s why at the end of this article we will examine companies such as Resource Capital Corp. (NYSE:RSO), BP Prudhoe Bay Royalty Trust (NYSE:BPT), and National Research Corp (NASDAQ:NRCIA) to gather more data points.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 18% gains over the past 12 months, more than doubling the 8% returns enjoyed by the S&P 500 ETFs.
How are hedge funds trading First Foundation Inc (NASDAQ:FFWM)?
At the end of the third quarter, a total of 7 of the hedge funds tracked by Insider Monkey were bullish on this stock, a drop of 36% from the second quarter of 2016. Below, you can check out the change in hedge fund sentiment towards FFWM over the last 5 quarters. With hedge funds’ capital changing hands, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their stakes substantially (or already accumulated large positions).
According to Insider Monkey’s hedge fund database, Robert I. Usdan and Wayne K. Goldstein’s Endicott Management holds the number one position in First Foundation Inc (NASDAQ:FFWM). Endicott Management has a $14.1 million position in the stock, comprising 6.3% of its 13F portfolio. The second most bullish fund manager is Matthew Lindenbaum’s Basswood Capital holding a $13.4 million position. Remaining members of the smart money that are bullish consist of James Dondero’s Highland Capital Management, Paul Magidson, Jonathan Cohen. And Ostrom Enders’ Castine Capital Management and Neil Chriss’ Hutchin Hill Capital. We should note that none of these hedge funds are among our list of the 100 best performing hedge funds which is based on the performance of their 13F long positions in non-microcap stocks.
Seeing as First Foundation Inc (NASDAQ:FFWM) has sustained falling interest from the smart money, it’s easy to see that there was a specific group of hedge funds who sold off their entire stakes in the third quarter. Interestingly, Emanuel J. Friedman’s EJF Capital sold off the largest investment of all the investors followed by Insider Monkey, worth about $5.2 million in stock. Renaissance Technologies, one of the largest hedge funds in the world, also said goodbye to its stock, about $0.7 million worth.
Let’s check out hedge fund activity in other stocks similar to First Foundation Inc (NASDAQ:FFWM). We will take a look at Resource Capital Corp. (NYSE:RSO), BP Prudhoe Bay Royalty Trust (NYSE:BPT), National Research Corp (NASDAQ:NRCIA), and IDT Corporation (NYSE:IDT). This group of stocks’ market valuations resemble FFWM’s market valuation.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
As you can see these stocks had an average of 4 hedge funds with bullish positions and the average amount invested in these stocks was $15 million. That figure was $41 million in FFWM’s case. IDT Corporation (NYSE:IDT) is the most popular stock in this table. On the other hand Resource Capital Corp. (NYSE:RSO) is the least popular one with only 2 bullish hedge fund positions. First Foundation Inc (NASDAQ:FFWM) 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. In this regard IDT might be a better candidate to consider taking a long position in.