Is First Republic Bank (FRC) Going to Burn These Hedge Funds?

Consequently, some big names were breaking ground themselves. Marshall Wace LLP, managed by Paul Marshall and Ian Wace, initiated the most outsized position in First Republic Bank (NYSE:FRC). The fund reportedly had $19.4 million invested in the company at the end of the quarter. Hugh Sloane’s Sloane Robinson Investment Management also made a $16.9 million investment in the stock during the quarter. The other funds with brand new FRC positions are Sharif Siddiqui’s Alpenglow Capital, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and George Hall’s Clinton Group.

Let’s now review hedge fund activity in other stocks similar to First Republic Bank (NYSE:FRC). We will take a look at ONEOK, Inc. (NYSE:OKE), Medivation Inc (NASDAQ:MDVN), Lennar Corporation (NYSE:LEN), and Best Buy Co., Inc. (NYSE:BBY). All of these stocks’ market caps are closest to FRC’s market cap.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
OKE 14 73303 -4
MDVN 1 1850 -64
LEN 48 1132322 8
BBY 40 792943 11

As you can see these stocks had an average of 26 hedge funds with bullish positions and the average amount invested in these stocks was $500 million. That figure was $531 million in FRC’s case. Lennar Corporation (NYSE:LEN) is the most popular stock in this table. On the other hand Medivation Inc (NASDAQ:MDVN) is the least popular one with only 1 bullish hedge fund positions. First Republic Bank (NYSE:FRC) 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. In this regard LEN might be a better candidate to consider a long position.

Disclosure: none.