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Were Hedge Funds Right About Picking BancorpSouth, Inc. (BXS)?

Is BancorpSouth, Inc. (NYSE:BXS) a good bet right now? We like to analyze hedge fund sentiment before conducting days of in-depth research. We do so because hedge funds and other elite investors have numerous Ivy League graduates, expert network advisers, and supply chain tipsters working or consulting for them. There is not a shortage of news stories covering failed hedge fund investments and it is a fact that hedge funds’ picks don’t beat the market 100% of the time, but their consensus picks have historically done very well and have outperformed the market after adjusting for risk.

BancorpSouth, Inc. (NYSE:BXS) was in 12 hedge funds’ portfolios at the end of the second quarter of 2019. BXS shareholders have witnessed an increase in hedge fund interest recently. There were 9 hedge funds in our database with BXS holdings at the end of the previous quarter. Our calculations also showed that BXS 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.

To the average investor there are a large number of gauges investors have at their disposal to appraise publicly traded companies. Some of the most innovative gauges are hedge fund and insider trading interest. Our experts have shown that, historically, those who follow the best picks of the best hedge fund managers can beat the broader indices by a superb margin (see the details here).

Ken Fisher FISHER ASSET MANAGEMENT

Unlike former hedge manager, Dr. Steve Sjuggerud, who is convinced Dow will soar past 40000, our long-short investment strategy doesn’t rely on bull markets to deliver double digit returns. We only rely on hedge fund buy/sell signals. Let’s review the latest hedge fund action regarding BancorpSouth, Inc. (NYSE:BXS).

Hedge fund activity in BancorpSouth, Inc. (NYSE:BXS)

At the end of the second quarter, a total of 12 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 33% from one quarter earlier. By comparison, 7 hedge funds held shares or bullish call options in BXS a year ago. So, let’s find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.

BXS_oct2019

Among these funds, Fisher Asset Management held the most valuable stake in BancorpSouth, Inc. (NYSE:BXS), which was worth $30 million at the end of the second quarter. On the second spot was Balyasny Asset Management which amassed $15.6 million worth of shares. Moreover, Millennium Management, East Side Capital (RR Partners), and Citadel Investment Group were also bullish on BancorpSouth, Inc. (NYSE:BXS), allocating a large percentage of their portfolios to this stock.

Consequently, specific money managers were breaking ground themselves. Laurion Capital Management, managed by Benjamin A. Smith, initiated the largest position in BancorpSouth, Inc. (NYSE:BXS). Laurion Capital Management had $0.4 million invested in the company at the end of the quarter. Mario Gabelli’s GAMCO Investors also initiated a $0.2 million position during the quarter. The other funds with new positions in the stock are D. E. Shaw’s D E Shaw and Matthew Tewksbury’s Stevens Capital Management.

Let’s now take a look at hedge fund activity in other stocks – not necessarily in the same industry as BancorpSouth, Inc. (NYSE:BXS) but similarly valued. We will take a look at SiteOne Landscape Supply, Inc. (NYSE:SITE), Intelsat S.A. (NYSE:I), Lithia Motors Inc (NYSE:LAD), and Vonage Holdings Corp. (NYSE:VG). This group of stocks’ market values are closest to BXS’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
SITE 12 39922 0
I 42 839597 -12
LAD 21 550945 4
VG 39 361173 5
Average 28.5 447909 -0.75

View table here if you experience formatting issues.

As you can see these stocks had an average of 28.5 hedge funds with bullish positions and the average amount invested in these stocks was $448 million. That figure was $63 million in BXS’s case. Intelsat S.A. (NYSE:I) is the most popular stock in this table. On the other hand SiteOne Landscape Supply, Inc. (NYSE:SITE) is the least popular one with only 12 bullish hedge fund positions. Compared to these stocks BancorpSouth, Inc. (NYSE:BXS) is even less popular than SITE. Our calculations showed that top 20 most popular stocks among hedge funds returned 24.4% in 2019 through September 30th and outperformed the S&P 500 ETF (SPY) by 4 percentage points. A small number of hedge funds were also right about betting on BXS, though not to the same extent, as the stock returned 2.6% during the third quarter and outperformed the market as well.

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

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