Seminole Management Banking Heavily On These Banks

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Michael Messner’s Seminole Capital Management Co. has filed its 13F with the SEC for the end of second quarter reporting period. The investment firm relies on technical analysis and charting for making its investments, and according to the latest available data, it has in excess of $4.17 billion worth of assets under management. The recent 13F filing of Seminole Capital Management has shown heavy reliance on banking stocks. Capital One Financial Corp. (NYSE:COF), Citigroup Inc (NYSE:C), and Bank of America Corp (NYSE:BAC) are among the top three banking investments of the hedge fund. The firm reported a public equity portfolio valued at $2.47 billion at the end of the second quarter, with its top ten stock holdings accounting for 56% of the overall portfolio. In terms of portfolio composition, Seminole Capital Management has dedicated more than one-third of its overall portfolio towards the finance sector. Its other major investment sectors are utilities & communications, and healthcare.

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Why are we interested in the 13F filings of a select group of hedge funds? We use these filings to determine the top 15 small-cap stocks held by these elite funds based on 16 years of research that showed their top small-cap picks are much more profitable than both their large-cap stocks and the broader market as a whole. These small-cap stocks beat the S&P 500 Total Return Index by an average of nearly one percentage point per month in our backtests, which were conducted over the period of 1999 to 2012. Moreover, since the beginning of forward testing from August 2012, the strategy worked just as our research predicted, outperforming the market every year and returning 123% over the last 35 months, which is more than 65 percentage points higher than the returns of the S&P 500 ETF (SPY) (see more details).

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Capital One Financial Corp. (NYSE:COF) lands at the top of the equity investments of Seminole Capital Management. The hedge fund boosted its stake in the company by 371% during the second quarter, bringing its investment to 2.67 million shares with a value of $234.77 million. The shares of Capital One Financial Corp. (NYSE:COF) have declined by 12.01% after its second quarter 2015 financial results, as the company reported a drop in earnings per share on a year-over-year basis. The banking institution reported net income of $863 million against prior year net income of $1.2 billion. In terms of its latest acquisition deals, Capital One Financial Corp. (NYSE:COF) is in discussions with General Electric Company (NYSE:GE) to acquire its U.S. Healthcare finance unit for as much as $10 billion. If this deal goes through, it will help Capital One strengthen its healthcare lending operations. At the end of the second quarter, Donald Chiboucis‘ Columbus Circle Investors was among the largest shareholders of the company in our database with net investments worth $239.21 million, consisting of 2.72 million shares of the banking company.

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