Sterling Bancorp, Inc. (Southfield, MI) (SBT) Fell Out Of Favor With Hedge Funds

Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 817 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds’ 2018 losses in Facebook and Apple. Let’s take a closer look at what the funds we track think about Sterling Bancorp, Inc. (Southfield, MI) (NASDAQ:SBT) in this article.

Sterling Bancorp, Inc. (Southfield, MI) (NASDAQ:SBT) was in 5 hedge funds’ portfolios at the end of September. The all time high for this statistics is 12. SBT has seen a decrease in hedge fund sentiment recently. There were 7 hedge funds in our database with SBT positions at the end of the second quarter. Our calculations also showed that SBT isn’t among the 30 most popular stocks among hedge funds (click for Q3 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.

Today there are several methods stock traders put to use to size up stocks. A duo of the most useful methods are hedge fund and insider trading sentiment. We have shown that, historically, those who follow the best picks of the elite fund managers can outperform the broader indices by a solid amount (see the details here).

David Harding

David Harding of Winton Capital Management

At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best blue chip stocks to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website. Now we’re going to take a glance at the key hedge fund action encompassing Sterling Bancorp, Inc. (Southfield, MI)(NASDAQ:SBT).

What have hedge funds been doing with Sterling Bancorp, Inc. (Southfield, MI) (NASDAQ:SBT)?

At third quarter’s end, a total of 5 of the hedge funds tracked by Insider Monkey were long this stock, a change of -29% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards SBT over the last 21 quarters. With the smart money’s capital changing hands, there exists a select group of key hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Renaissance Technologies has the most valuable position in Sterling Bancorp, Inc. (Southfield, MI) (NASDAQ:SBT), worth close to $1 million, comprising less than 0.1%% of its total 13F portfolio. Coming in second is Winton Capital Management, managed by David Harding, which holds a $0.2 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Some other hedge funds and institutional investors with similar optimism encompass Ron Mass’s Almitas Capital, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital and John Overdeck and David Siegel’s Two Sigma Advisors. In terms of the portfolio weights assigned to each position Almitas Capital allocated the biggest weight to Sterling Bancorp, Inc. (Southfield, MI) (NASDAQ:SBT), around 0.25% of its 13F portfolio. Winton Capital Management is also relatively very bullish on the stock, designating 0.01 percent of its 13F equity portfolio to SBT.

Since Sterling Bancorp, Inc. (Southfield, MI) (NASDAQ:SBT) has experienced declining sentiment from the aggregate hedge fund industry, it’s safe to say that there was a specific group of funds that elected to cut their entire stakes by the end of the third quarter. Intriguingly, Roger Ibbotson’s Zebra Capital Management dropped the biggest investment of the “upper crust” of funds tracked by Insider Monkey, totaling about $0.1 million in stock. Peter Muller’s fund, PDT Partners, also sold off its stock, about $0 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest was cut by 2 funds by the end of the third quarter.

Let’s go over hedge fund activity in other stocks – not necessarily in the same industry as Sterling Bancorp, Inc. (Southfield, MI) (NASDAQ:SBT) but similarly valued. We will take a look at Northeast Bank (NASDAQ:NBN), Silvercrest Asset Management Group Inc (NASDAQ:SAMG), Timberland Bancorp, Inc. (NASDAQ:TSBK), Penn Virginia Corporation (NASDAQ:PVAC), Ramaco Resources, Inc. (NASDAQ:METC), Tsakos Energy Navigation Ltd. (NYSE:TNP), and Horizon Global Corp (NYSE:HZN). This group of stocks’ market values match SBT’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
NBN 4 21639 -1
SAMG 3 8376 0
TSBK 4 18156 1
PVAC 9 25550 -2
METC 6 2809 -3
TNP 4 11320 -5
HZN 3 16612 0
Average 4.7 14923 -1.4

View table here if you experience formatting issues.

As you can see these stocks had an average of 4.7 hedge funds with bullish positions and the average amount invested in these stocks was $15 million. That figure was $1 million in SBT’s case. Penn Virginia Corporation (NASDAQ:PVAC) is the most popular stock in this table. On the other hand Silvercrest Asset Management Group Inc (NASDAQ:SAMG) is the least popular one with only 3 bullish hedge fund positions. Sterling Bancorp, Inc. (Southfield, MI) (NASDAQ:SBT) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for SBT is 32.2. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 20 most popular stocks among hedge funds returned 41.3% in 2019 and outperformed the S&P 500 ETF (SPY) by 10 percentage points. These stocks gained 30.7% in 2020 through November 27th and still beat the market by 16.1 percentage points. Hedge funds were also right about betting on SBT as the stock returned 28.9% since the end of Q3 (through 11/27) and outperformed the market. Hedge funds were rewarded for their relative bullishness.

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