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 Meridian Corporation (NASDAQ:MRBK).
Meridian Corporation (NASDAQ:MRBK) shareholders have witnessed an increase in support from the world's most elite money managers recently. Our calculations also showed that MRBK 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.
In the eyes of most stock holders, hedge funds are seen as slow, old financial vehicles of the past. While there are more than 8000 funds in operation at the moment, We look at the aristocrats of this club, about 850 funds. Most estimates calculate that this group of people watch over most of the hedge fund industry's total asset base, and by shadowing their finest equity investments, Insider Monkey has formulated numerous investment strategies that have historically outrun the S&P 500 index. Insider Monkey's flagship short hedge fund strategy outperformed the S&P 500 short ETFs by around 20 percentage points annually 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 leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Keeping this in mind let's take a look at the latest hedge fund action regarding Meridian Corporation (NASDAQ:MRBK).
How have hedgies been trading Meridian Corporation (NASDAQ:MRBK)?
At Q1's end, a total of 7 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 17% from the previous quarter. On the other hand, there were a total of 5 hedge funds with a bullish position in MRBK a year ago. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Is MRBK A Good Stock To Buy?
When looking at the institutional investors followed by Insider Monkey, Michael Price's MFP Investors has the number one position in Meridian Corporation (NASDAQ:MRBK), worth close to $4.1 million, accounting for 0.8% of its total 13F portfolio. On MFP Investors's heels is Matthew Lindenbaum of Basswood Capital, with a $3.9 million position; the fund has 0.5% of its 13F portfolio invested in the stock. Some other members of the smart money with similar optimism contain Phil Stone's Fourthstone LLC, Paul Tudor Jones's Tudor Investment Corp and Frederick DiSanto's Ancora Advisors. In terms of the portfolio weights assigned to each position Fourthstone LLC allocated the biggest weight to Meridian Corporation (NASDAQ:MRBK), around 1.27% of its 13F portfolio. MFP Investors is also relatively very bullish on the stock, earmarking 0.83 percent of its 13F equity portfolio to MRBK.
Now, some big names have jumped into Meridian Corporation (NASDAQ:MRBK) headfirst. Millennium Management, managed by Israel Englander, created the largest position in Meridian Corporation (NASDAQ:MRBK). Millennium Management had $0.2 million invested in the company at the end of the quarter. Michael Gelband's ExodusPoint Capital also made a $0.1 million investment in the stock during the quarter.
Let's now review hedge fund activity in other stocks similar to Meridian Corporation (NASDAQ:MRBK). These stocks are Flexsteel Industries, Inc. (NASDAQ:FLXS), Geospace Technologies Corp (NASDAQ:GEOS), Townsquare Media Inc (NYSE:TSQ), and HMN Financial, Inc. (NASDAQ:HMNF). This group of stocks' market valuations resemble MRBK's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position FLXS,7,14977,0 GEOS,4,3823,-3 TSQ,7,19176,-2 HMNF,4,22411,0 Average,5.5,15097,-1.25 [/table]
As you can see these stocks had an average of 5.5 hedge funds with bullish positions and the average amount invested in these stocks was $15 million. That figure was $11 million in MRBK's case. Flexsteel Industries, Inc. (NASDAQ:FLXS) is the most popular stock in this table. On the other hand Geospace Technologies Corp (NASDAQ:GEOS) is the least popular one with only 4 bullish hedge fund positions. Meridian Corporation (NASDAQ:MRBK) 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 13.9% in 2020 through June 10th but still beat the market by 14.2 percentage points. Hedge funds were also right about betting on MRBK, though not to the same extent, as the stock returned 25.3% during the first two months and ten days of the second quarter and outperformed the market as well.
