Is Baker Hughes Incorporated (BHI) Going to Burn These Hedge Funds?

Baker Hughes Incorporated (NYSE:BHI) was in 31 hedge funds’ portfolio at the end of March. BHI has experienced a decrease in activity from the world’s largest hedge funds of late. There were 31 hedge funds in our database with BHI positions at the end of the previous quarter.

To the average investor, there are a multitude of methods shareholders can use to monitor stocks. A pair of the best are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite fund managers can outclass the broader indices by a superb margin (see just how much).

Just as integral, bullish insider trading activity is a second way to parse down the marketplace. There are plenty of incentives for an executive to drop shares of his or her company, but just one, very simple reason why they would buy. Various academic studies have demonstrated the market-beating potential of this strategy if “monkeys” understand where to look (learn more here).

Now, we’re going to take a glance at the latest action surrounding Baker Hughes Incorporated (NYSE:BHI).

How have hedgies been trading Baker Hughes Incorporated (NYSE:BHI)?

In preparation for this quarter, a total of 31 of the hedge funds we track were long in this stock, a change of 0% from one quarter earlier. With hedge funds’ sentiment swirling, there exists a few noteworthy hedge fund managers who were increasing their stakes meaningfully.

When looking at the hedgies we track, Richard S. Pzena’s Pzena Investment Management had the most valuable position in Baker Hughes Incorporated (NYSE:BHI), worth close to $416.7 million, accounting for 2.9% of its total 13F portfolio. The second largest stake is held by Edgar Wachenheim of Greenhaven Associates, with a $364.9 million position; 10% of its 13F portfolio is allocated to the stock. Some other hedgies that are bullish include Kerr Neilson’s Platinum Asset Management, Charles de Vaulx’s International Value Advisers and Steven Cohen’s SAC Capital Advisors.

Due to the fact that Baker Hughes Incorporated (NYSE:BHI) has witnessed a declination in interest from the aggregate hedge fund industry, it’s easy to see that there were a few hedge funds that slashed their positions entirely heading into Q2. Intriguingly, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital said goodbye to the largest position of the 450+ funds we track, worth an estimated $37.4 million in stock., and Jason Adler of AlphaBet Management was right behind this move, as the fund said goodbye to about $29.7 million worth. These moves are important to note, as aggregate hedge fund interest stayed the same (this is a bearish signal in our experience).

Insider trading activity in Baker Hughes Incorporated (NYSE:BHI)

Insider trading activity, especially when it’s bullish, is at its handiest when the company we’re looking at has seen transactions within the past six months. Over the latest half-year time frame, Baker Hughes Incorporated (NYSE:BHI) has experienced zero unique insiders buying, and 6 insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Baker Hughes Incorporated (NYSE:BHI). These stocks are Weatherford International Ltd (NYSE:WFT), Halliburton Company (NYSE:HAL), FMC Technologies, Inc. (NYSE:FTI), National-Oilwell Varco, Inc. (NYSE:NOV), and Cameron International Corporation (NYSE:CAM). This group of stocks belong to the oil & gas equipment & services industry and their market caps are closest to BHI’s market cap.