Magellan Midstream Partners, L.P. (NYSE:MMP) was in 11 hedge funds’ portfolio at the end of the first quarter of 2013. MMP has seen a decrease in activity from the world’s largest hedge funds of late. There were 11 hedge funds in our database with MMP holdings at the end of the previous quarter.
To the average investor, there are dozens of metrics market participants can use to watch publicly traded companies. Two of the most underrated are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the best money managers can outpace the S&P 500 by a superb amount (see just how much).
Just as important, positive insider trading sentiment is another way to break down the investments you’re interested in. As the old adage goes: there are plenty of stimuli for a corporate insider to get rid of shares of his or her company, but only one, very simple reason why they would buy. Several empirical studies have demonstrated the impressive potential of this tactic if piggybackers know where to look (learn more here).
Now, it’s important to take a glance at the recent action encompassing Magellan Midstream Partners, L.P. (NYSE:MMP).
How are hedge funds trading Magellan Midstream Partners, L.P. (NYSE:MMP)?
At Q1’s end, a total of 11 of the hedge funds we track were long in this stock, a change of 0% from one quarter earlier. With hedgies’ capital changing hands, there exists a select group of key hedge fund managers who were upping their stakes meaningfully.
According to our comprehensive database, John Osterweis’s Osterweis Capital Management had the biggest position in Magellan Midstream Partners, L.P. (NYSE:MMP), worth close to $92 million, comprising 3.5% of its total 13F portfolio. On Osterweis Capital Management’s heels is Royce & Associates, managed by Chuck Royce, which held a $39.4 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other hedge funds with similar optimism include Jim Simons’s Renaissance Technologies, and Richard Driehaus’s Driehaus Capital.
Due to the fact that Magellan Midstream Partners, L.P. (NYSE:MMP) has witnessed falling interest from the smart money, we can see that there was a specific group of funds that slashed their entire stakes heading into Q2. Intriguingly, Russell Lucas’s Lucas Capital Management cut the biggest investment of the 450+ funds we track, valued at close to $3.9 million in stock., and Matthew Hulsizer of PEAK6 Capital Management was right behind this move, as the fund said goodbye to about $0.1 million worth. These bearish behaviors are interesting, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
What have insiders been doing with Magellan Midstream Partners, L.P. (NYSE:MMP)?
Insider buying is at its handiest when the company we’re looking at has experienced transactions within the past six months. Over the last 180-day time period, Magellan Midstream Partners, L.P. (NYSE:MMP) has experienced zero unique insiders purchasing, and 1 insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Magellan Midstream Partners, L.P. (NYSE:MMP). These stocks are Pembina Pipeline Corp (NYSE:PBA), Energy Transfer Partners LP (NYSE:ETP), El Paso Pipeline Partners, L.P. (NYSE:EPB), Kinder Morgan Management, LLC (NYSE:KMR), and Oneok Partners LP (NYSE:OKS). This group of stocks belong to the oil & gas pipelines industry and their market caps are closest to MMP’s market cap.