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Hedge Funds Are Buying North American Energy Partners Inc.(USA) (NOA)

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Is North American Energy Partners Inc.(USA) (NYSE:NOA) a buy, sell, or hold? Money managers are turning bullish. The number of long hedge fund bets advanced by 3 recently.

To most investors, hedge funds are assumed to be unimportant, outdated investment vehicles of years past. While there are greater than 8000 funds with their doors open today, we look at the elite of this group, around 450 funds. It is estimated that this group oversees most of all hedge funds’ total capital, and by watching their highest performing picks, we have unearthed a number of investment strategies that have historically beaten the S&P 500 index. Our small-cap hedge fund strategy outpaced the S&P 500 index by 18 percentage points per annum 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 trumped the S&P 500 index by 23.3 percentage points in 8 months (check out a sample of our picks).

Just as key, bullish insider trading activity is a second way to break down the marketplace. As the old adage goes: there are lots of reasons for a corporate insider to drop shares of his or her company, but only one, very simple reason why they would behave bullishly. Various empirical studies have demonstrated the impressive potential of this method if you know what to do (learn more here).

With all of this in mind, we’re going to take a gander at the recent action surrounding North American Energy Partners Inc.(USA) (NYSE:NOA).

What does the smart money think about North American Energy Partners Inc.(USA) (NYSE:NOA)?

At the end of the first quarter, a total of 10 of the hedge funds we track were long in this stock, a change of 43% from the previous quarter. With hedge funds’ capital changing hands, there exists an “upper tier” of key hedge fund managers who were increasing their stakes considerably.

North American Energy Partners Inc.(USA) (NYSE:NOA)When looking at the hedgies we track, Harbinger, managed by Phil Falcone, holds the largest position in North American Energy Partners Inc.(USA) (NYSE:NOA). Harbinger has a $31.9 million position in the stock, comprising 1.3% of its 13F portfolio. Sitting at the No. 2 spot is Richard Perry of Perry Capital, with a $20.9 million position; the fund has 0.7% of its 13F portfolio invested in the stock. Some other peers that are bullish include Stephen Loukas, David A. Lorber, Zachary George’s FrontFour Capital Group, J. Carlo Cannell’s Cannell Capital and D. E. Shaw’s D E Shaw.

As industrywide interest jumped, key hedge funds were breaking ground themselves. Wexford Capital, managed by Charles Davidson, created the most valuable position in North American Energy Partners Inc.(USA) (NYSE:NOA). Wexford Capital had 0.7 million invested in the company at the end of the quarter. John Overdeck and David Siegel’s Two Sigma Advisors also made a $0.1 million investment in the stock during the quarter. The only other fund with a brand new NOA position is Gregory Fraser Rudolph Kluiber and Timothy Krochuk’s GRT Capital Partners.

Insider trading activity in North American Energy Partners Inc.(USA) (NYSE:NOA)

Insider purchases made by high-level executives is at its handiest when the company in question has experienced transactions within the past 180 days. Over the latest half-year time frame, North American Energy Partners Inc.(USA) (NYSE:NOA) has seen zero unique insiders buying, and zero insider sales (see the details of insider trades here).

Let’s also review hedge fund and insider activity in other stocks similar to North American Energy Partners Inc.(USA) (NYSE:NOA). These stocks are Dawson Geophysical Company (NASDAQ:DWSN), Natural Gas Services Group, Inc. (NYSE:NGS), TGC Industries Inc (NASDAQ:TGE), Bolt Technology Corp. (NASDAQ:BOLT), and Cal Dive International, Inc. (NYSE:DVR). This group of stocks are in the oil & gas equipment & services industry and their market caps are similar to NOA’s market cap.

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