ConocoPhillips (COP): Hedge Funds Are Snapping Up

Insider Monkey finished processing more than 700 13F filings made by hedge funds and prominent investors. These filings show these funds’ portfolio positions as of September 30. In this article we are going to take a look at smart money sentiment towards ConocoPhillips (NYSE:COP).

ConocoPhillips (NYSE:COP) investors should be aware of an increase in activity from the world’s largest hedge funds of late. ConocoPhillips (NYSE:COP) was in 44 hedge funds’ portfolios at the end of the third quarter of 2015. There were 43 hedge funds in our database with ConocoPhillips (NYSE:COP) holdings at the end of the previous quarter. The level and the change in hedge fund popularity aren’t the only variables you need to analyze to decipher hedge funds’ perspectives. A stock may witness a boost in popularity, but it may still be less popular than similarly priced stocks. That’s why at the end of this article, we will examine companies such as Danaher Corporation (NYSE:DHR), Colgate-Palmolive Company (NYSE:CL), and Simon Property Group, Inc (NYSE:SPG) to gather more data points.

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In the eyes of most shareholders, hedge funds are seen as underperforming, outdated investment tools of years past. While there are greater than 8000 funds in operation at the moment, Our researchers choose to focus on the crème de la crème of this club, about 700 funds. These investment experts shepherd most of the smart money’s total capital, and by shadowing their top equity investments, Insider Monkey has brought to light many investment strategies that have historically outrun Mr. Market. Insider Monkey’s small-cap hedge fund strategy outperformed the S&P 500 index by 12 percentage points a year for a decade in their back tests.

Now, we’re going to take a gander at the key action regarding ConocoPhillips (NYSE:COP).

What have hedge funds been doing with ConocoPhillips (NYSE:COP)?

At the end of the third quarter, a total of 44 of the hedge funds tracked by Insider Monkey were bullish on this stock, an increase of 2% from the second quarter. With hedge funds’ capital changing hands, there exists a select group of key hedge fund managers who were increasing their stakes meaningfully (or already accumulated large positions).

Of the funds tracked by Insider Monkey, Yacktman Asset Management, managed by Donald Yacktman, holds the number one position in ConocoPhillips (NYSE:COP). Yacktman Asset Management has a $274.4 million position in the stock, comprising 1.8% of its 13F portfolio. Coming in second is HBK Investments, managed by David Costen Haley, which holds a $98.2 million call position; the fund has 1.2% of its 13F portfolio invested in the stock. Remaining professional money managers that are bullish contain D E Shaw, Cliff Asness’ AQR Capital Management, and Dmitry Balyasny’s Balyasny Asset Management.

Consequently, specific money managers were leading the bulls’ herd. Balyasny Asset Management created the most valuable position in ConocoPhillips (NYSE:COP). Balyasny Asset Management had $64.1 million invested in the company at the end of the quarter. Malcolm Fairbairn’s Ascend Capital also made a $35.5 million investment in the stock during the quarter. The other funds with brand new COP positions are Curtis Macnguyen’s Ivory Capital (Investment Mgmt), Joe DiMenna’s ZWEIG DIMENNA PARTNERS, and Paul Tudor Jones’s Tudor Investment Corp.

Let’s also examine hedge fund activity in other stocks similar to ConocoPhillips (NYSE:COP). These stocks are Danaher Corporation (NYSE:DHR), Colgate-Palmolive Company (NYSE:CL), Simon Property Group, Inc (NYSE:SPG), and Time Warner Inc (NYSE:TWX). This group of stocks’ market values is similar to ConocoPhillips (NYSE:COP)’s market value.

Ticker No of HFs with positions Total Value of HF Positions (x1000) Change in HF Position
DHR 53 1976453 0
CL 31 1803185 -4
SPG 30 1164516 2
TWX 69 4320751 1

As you can see, these stocks had an average of 46 hedge funds with bullish positions and the average amount invested in these stocks was $2.32 billion. That figure was $1.24 billion in ConocoPhillips (NYSE:COP)’s case. Time Warner Inc (NYSE:TWX) is the most popular stock in this table. On the other hand, Simon Property Group, Inc (NYSE:SPG) is the least popular one with only 30 bullish hedge fund positions. ConocoPhillips (NYSE:COP) is not the least popular stock in this group, but hedge fund interest is still below average. This is a slightly negative signal and we’d rather spend our time researching stocks that hedge funds are piling on. In this regard, Time Warner Inc (NYSE:TWX) might be a better candidate to consider a long position.