Is Enterprise Products Partners L.P. (NYSE:EPD) going to take off soon? The best stock pickers are getting more optimistic. The number of long hedge fund bets increased by 4 in recent months.
According to most stock holders, hedge funds are assumed to be slow, outdated investment vehicles of the past. While there are over 8000 funds in operation at present, we hone in on the top tier of this group, about 450 funds. It is widely believed that this group controls most of the hedge fund industry’s total capital, and by tracking their highest performing picks, we have deciphered a few investment strategies that have historically beaten Mr. Market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have topped the S&P 500 index by 23.3 percentage points in 8 months (explore the details and some picks here).
Just as integral, positive insider trading activity is another way to break down the world of equities. Obviously, there are a number of incentives for an upper level exec to sell shares of his or her company, but just one, very simple reason why they would behave bullishly. Many academic studies have demonstrated the market-beating potential of this tactic if “monkeys” know where to look (learn more here).
Keeping this in mind, let’s take a gander at the key action regarding Enterprise Products Partners L.P. (NYSE:EPD).
What does the smart money think about Enterprise Products Partners L.P. (NYSE:EPD)?
At the end of the first quarter, a total of 15 of the hedge funds we track were long in this stock, a change of 36% from one quarter earlier. With hedgies’ sentiment swirling, there exists a select group of key hedge fund managers who were increasing their stakes meaningfully.
According to our comprehensive database, Jim Simons’s Renaissance Technologies had the biggest position in Enterprise Products Partners L.P. (NYSE:EPD), worth close to $83.3 million, comprising 0.2% of its total 13F portfolio. On Renaissance Technologies’s heels is John Osterweis of Osterweis Capital Management, with a $71.9 million position; the fund has 2.7% of its 13F portfolio invested in the stock. Other peers that are bullish include Matthew Hulsizer’s PEAK6 Capital Management, and Noam Gottesman’s GLG Partners.
As one would reasonably expect, specific money managers have been driving this bullishness. Millennium Management, managed by Israel Englander, initiated the most valuable call position in Enterprise Products Partners L.P. (NYSE:EPD). Millennium Management had 9.6 million invested in the company at the end of the quarter. Noam Gottesman’s GLG Partners also initiated a $6 million position during the quarter. The following funds were also among the new EPD investors: John Zaro’s Bourgeon Capital, Ken Fisher’s Fisher Asset Management, and T Boone Pickens’s BP Capital.
What have insiders been doing with Enterprise Products Partners L.P. (NYSE:EPD)?
Insider buying is best served when the company in question has seen transactions within the past half-year. Over the latest 180-day time period, Enterprise Products Partners L.P. (NYSE:EPD) has seen 1 unique insiders purchasing, and 3 insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to Enterprise Products Partners L.P. (NYSE:EPD). These stocks are EOG Resources Inc (NYSE:EOG), Canadian Natural Resource Ltd (USA) (NYSE:CNQ), CNOOC Limited (ADR) (NYSE:CEO), Anadarko Petroleum Corporation (NYSE:APC), and Suncor Energy Inc. (USA) (NYSE:SU). This group of stocks are in the independent oil & gas industry and their market caps resemble EPD’s market cap.