Penn West Petroleum Ltd (USA) (NYSE:PWE) was in 14 hedge funds' portfolio at the end of March. PWE has experienced an increase in enthusiasm from smart money in recent months. There were 9 hedge funds in our database with PWE positions at the end of the previous quarter.
In the financial world, there are many methods investors can use to monitor the equity markets. Two of the most under-the-radar are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the top investment managers can trounce their index-focused peers by a healthy margin (see just how much).
Equally as key, positive insider trading activity is another way to break down the marketplace. Obviously, there are many incentives for an upper level exec to sell shares of his or her company, but only one, very simple reason why they would buy. Many empirical studies have demonstrated the valuable potential of this method if "monkeys" understand where to look (learn more here).
Keeping this in mind, let's take a glance at the recent action surrounding Penn West Petroleum Ltd (USA) (NYSE:PWE).
At Q1's end, a total of 14 of the hedge funds we track held long positions in this stock, a change of 56% from the previous quarter. With hedgies' capital changing hands, there exists a few notable hedge fund managers who were increasing their stakes substantially.
Of the funds we track, First Eagle Investment Management, managed by Jean-Marie Eveillard, holds the biggest position in Penn West Petroleum Ltd (USA) (NYSE:PWE). First Eagle Investment Management has a $392.4 million position in the stock, comprising 1.3% of its 13F portfolio. On First Eagle Investment Management's heels is Greg Boland of West Face Capital, with a $86.1 million position; 15.8% of its 13F portfolio is allocated to the stock. Some other hedge funds that are bullish include Stephen Loukas, David A. Lorber, Zachary George's FrontFour Capital Group, Curtis Schenker and Craig Effron's Scoggin and Neil Chriss's Hutchin Hill Capital.
As industrywide interest jumped, key money managers have been driving this bullishness. FrontFour Capital Group, managed by Stephen Loukas, David A. Lorber, Zachary George, created the most outsized position in Penn West Petroleum Ltd (USA) (NYSE:PWE). FrontFour Capital Group had 11.3 million invested in the company at the end of the quarter. Curtis Schenker and Craig Effron's Scoggin also initiated a $4.9 million position during the quarter. The other funds with new positions in the stock are Neil Chriss's Hutchin Hill Capital, Stephen Loukas, David A. Lorber, Zachary George's FrontFour Capital Group, and Jim Simons's Renaissance Technologies.
Insider trading activity, especially when it's bullish, is most useful when the company in question has seen transactions within the past half-year. Over the latest 180-day time frame, Penn West Petroleum Ltd (USA) (NYSE:PWE) has experienced zero unique insiders purchasing, 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 Penn West Petroleum Ltd (USA) (NYSE:PWE). These stocks are Helmerich & Payne, Inc. (NYSE:HP), Rowan Companies PLC (NYSE:RDC), Whiting Petroleum Corp (NYSE:WLL), Nabors Industries Ltd. (NYSE:NBR), and QEP Resources Inc (NYSE:QEP). All of these stocks are in the oil & gas drilling & exploration industry and their market caps are closest to PWE's market cap.