Is Territorial Bancorp Inc (TBNK) Going to Burn These Hedge Funds?

Before we spend countless hours researching a company, we like to analyze what insiders, hedge funds and billionaire investors think of the stock first. This is a necessary first step in our investment process because our research has shown that the elite investors’ consensus returns have been exceptional. In the following paragraphs, we find out what the billionaire investors and hedge funds think of Territorial Bancorp Inc (NASDAQ:TBNK).

Territorial Bancorp Inc (NASDAQ:TBNK) investors should be aware of an increase in hedge fund sentiment recently. Our calculations also showed that TBNK isn’t among the 30 most popular stocks among hedge funds (see the video below).
5 Most Popular Stocks Among Hedge Funds
Video: Click the image to watch our video about the top 5 most popular hedge fund stocks.

In the 21st century investor’s toolkit there are a large number of methods stock market investors employ to evaluate publicly traded companies. A duo of the most underrated methods are hedge fund and insider trading moves. Our researchers have shown that, historically, those who follow the top picks of the best money managers can outpace the market by a superb amount (see the details here).

Chuck Royce

In addition to following the biggest hedge funds for investment ideas, we also share stock pitches from conferences, investor letters and other sources  like this one where the fund manager is talking about two under the radar 1000% return potential stocks: first one in internet infrastructure and the second in the heart of advertising market. We use hedge fund buy/sell signals to determine whether to conduct in-depth analysis of these stock ideas which take days. We’re going to check out the key hedge fund action encompassing Territorial Bancorp Inc (NASDAQ:TBNK).

What does smart money think about Territorial Bancorp Inc (NASDAQ:TBNK)?

Heading into the third quarter of 2019, a total of 4 of the hedge funds tracked by Insider Monkey were long this stock, a change of 33% from the first quarter of 2019. The graph below displays the number of hedge funds with bullish position in TBNK over the last 16 quarters. So, let’s review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

No of Hedge Funds with TBNK Positions

Of the funds tracked by Insider Monkey, Renaissance Technologies holds the biggest position in Territorial Bancorp Inc (NASDAQ:TBNK). Renaissance Technologies has a $20.3 million position in the stock, comprising less than 0.1%% of its 13F portfolio. The second most bullish fund manager is Royce & Associates, led by Chuck Royce, holding a $2.6 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Remaining members of the smart money that hold long positions consist of Israel Englander’s Millennium Management, John Overdeck and David Siegel’s Two Sigma Advisors and .

As aggregate interest increased, some big names were leading the bulls’ herd. Millennium Management, managed by Israel Englander, assembled the most valuable position in Territorial Bancorp Inc (NASDAQ:TBNK). Millennium Management had $0.4 million invested in the company at the end of the quarter.

Let’s go over hedge fund activity in other stocks similar to Territorial Bancorp Inc (NASDAQ:TBNK). These stocks are IDT Corporation (NYSE:IDT), Greenhill & Co., Inc. (NYSE:GHL), Daktronics, Inc. (NASDAQ:DAKT), and Southern First Bancshares, Inc. (NASDAQ:SFST). This group of stocks’ market values are closest to TBNK’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
IDT 13 36438 -1
GHL 11 15868 -4
DAKT 9 16137 -1
SFST 7 38113 0
Average 10 26639 -1.5

View table here if you experience formatting issues.

As you can see these stocks had an average of 10 hedge funds with bullish positions and the average amount invested in these stocks was $27 million. That figure was $24 million in TBNK’s case. IDT Corporation (NYSE:IDT) is the most popular stock in this table. On the other hand Southern First Bancshares, Inc. (NASDAQ:SFST) is the least popular one with only 7 bullish hedge fund positions. Compared to these stocks Territorial Bancorp Inc (NASDAQ:TBNK) is even less popular than SFST. Hedge funds dodged a bullet by taking a bearish stance towards TBNK. Our calculations showed that the top 20 most popular hedge fund stocks returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. Unfortunately TBNK wasn’t nearly as popular as these 20 stocks (hedge fund sentiment was very bearish); TBNK investors were disappointed as the stock returned -6.5% during the third quarter and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 20 most popular stocks among hedge funds as many of these stocks already outperformed the market so far in 2019.

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