The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 821 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of March 31st, a week after the market trough. In this article we look at what those investors think of The Bancorp, Inc. (NASDAQ:TBBK).
Is The Bancorp, Inc. (NASDAQ:TBBK) a buy here? Investors who are in the know are in a pessimistic mood. The number of long hedge fund bets shrunk by 3 recently. Our calculations also showed that TBBK isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks).
Video: Watch our video about the top 5 most popular hedge fund stocks.
According to most market participants, hedge funds are seen as slow, old financial vehicles of yesteryear. While there are over 8000 funds with their doors open at the moment, Our experts hone in on the upper echelon of this group, about 850 funds. These investment experts have their hands on bulk of the smart money’s total capital, and by shadowing their matchless equity investments, Insider Monkey has revealed many investment strategies that have historically beaten the market. Insider Monkey’s flagship short hedge fund strategy surpassed the S&P 500 short ETFs by around 20 percentage points per annum since its inception in March 2017. Our portfolio of short stocks lost 36% since February 2017 (through May 18th) even though the market was up 30% during the same period. We just shared a list of 8 short targets in our latest quarterly update .
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, blockchain technology’s influence will go beyond online payments. So, we are checking out this futurist’s moonshot opportunities in tech stocks. We interview hedge fund managers and ask them about their best ideas. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. For example we are checking out stocks recommended/scorned by legendary Bill Miller. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. Keeping this in mind let’s take a look at the fresh hedge fund action surrounding The Bancorp, Inc. (NASDAQ:TBBK).
How are hedge funds trading The Bancorp, Inc. (NASDAQ:TBBK)?
At the end of the first quarter, a total of 15 of the hedge funds tracked by Insider Monkey were long this stock, a change of -17% from the fourth quarter of 2019. By comparison, 16 hedge funds held shares or bullish call options in TBBK a year ago. With hedgies’ capital changing hands, there exists a select group of noteworthy hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).
The largest stake in The Bancorp, Inc. (NASDAQ:TBBK) was held by Nantahala Capital Management, which reported holding $16.3 million worth of stock at the end of September. It was followed by Rutabaga Capital Management with a $6.6 million position. Other investors bullish on the company included Renaissance Technologies, AQR Capital Management, and D E Shaw. In terms of the portfolio weights assigned to each position Second Curve Capital allocated the biggest weight to The Bancorp, Inc. (NASDAQ:TBBK), around 12.55% of its 13F portfolio. Rutabaga Capital Management is also relatively very bullish on the stock, setting aside 3.96 percent of its 13F equity portfolio to TBBK.
Because The Bancorp, Inc. (NASDAQ:TBBK) has witnessed bearish sentiment from the smart money, logic holds that there exists a select few hedgies who were dropping their positions entirely last quarter. Interestingly, Noam Gottesman’s GLG Partners dropped the biggest stake of all the hedgies watched by Insider Monkey, comprising an estimated $0.3 million in stock. Michael Gelband’s fund, ExodusPoint Capital, also cut its stock, about $0.3 million worth. These bearish behaviors are interesting, as total hedge fund interest fell by 3 funds last quarter.
Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as The Bancorp, Inc. (NASDAQ:TBBK) but similarly valued. These stocks are Mercantile Bank Corp. (NASDAQ:MBWM), Adesto Technologies Corporation (NASDAQ:IOTS), New Gold Inc. (NYSE:NGD), and 89bio, Inc. (NASDAQ:ETNB). All of these stocks’ market caps resemble TBBK’s market cap.
|Ticker||No of HFs with positions||Total Value of HF Positions (x1000)||Change in HF Position|
View table here if you experience formatting issues.
As you can see these stocks had an average of 8 hedge funds with bullish positions and the average amount invested in these stocks was $80 million. That figure was $45 million in TBBK’s case. Adesto Technologies Corporation (NASDAQ:IOTS) is the most popular stock in this table. On the other hand 89bio, Inc. (NASDAQ:ETNB) is the least popular one with only 3 bullish hedge fund positions. The Bancorp, Inc. (NASDAQ:TBBK) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 13.3% in 2020 through June 25th but still beat the market by 16.8 percentage points. Hedge funds were also right about betting on TBBK as the stock returned 51.7% in Q2 (through June 25th) and outperformed the market. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published at Insider Monkey.