Is Pengrowth Energy Corp (USA) (NYSE:PGH) a buy right now? The smart money is taking a pessimistic view. The number of long hedge fund bets stayed the same which is a slightly negative development in our experience
In the 21st century investor’s toolkit, there are a multitude of methods investors can use to analyze stocks. A couple of the best 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 elite fund managers can beat the market by a solid amount (see just how much).
Just as important, optimistic insider trading sentiment is a second way to parse down the investments you’re interested in. As the old adage goes: there are plenty of incentives for an insider to drop shares of his or her company, but just one, very obvious reason why they would behave bullishly. Many empirical studies have demonstrated the useful potential of this method if shareholders understand where to look (learn more here).
Keeping this in mind, it’s important to take a peek at the latest action surrounding Pengrowth Energy Corp (USA) (NYSE:PGH).
What have hedge funds been doing with Pengrowth Energy Corp (USA) (NYSE:PGH)?
Heading into Q2, a total of 9 of the hedge funds we track were bullish in this stock, a change of 0% from the first quarter. With hedge funds’ capital changing hands, there exists a select group of noteworthy hedge fund managers who were increasing their stakes significantly.
According to our comprehensive database, Royce & Associates, managed by Chuck Royce, holds the largest position in Pengrowth Energy Corp (USA) (NYSE:PGH). Royce & Associates has a $7.6 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Sitting at the No. 2 spot is Millennium Management, managed by Israel Englander, which held a $3.1 million position; the fund has less than 0.1%% of its 13F portfolio invested in the stock. Some other hedge funds with similar optimism include Brian Stark’s Stark Investments, Eric Sprott’s Sprott Asset Management and Ken Griffin’s Citadel Investment Group.
Because Pengrowth Energy Corp (USA) (NYSE:PGH) has faced a declination in interest from hedge fund managers, it’s easy to see that there lies a certain “tier” of hedgies who sold off their entire stakes last quarter. At the top of the heap, Jim Simons’s Renaissance Technologies dropped the biggest stake of the “upper crust” of funds we watch, comprising an estimated $1.3 million in stock. These moves are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
How are insiders trading Pengrowth Energy Corp (USA) (NYSE:PGH)?
Insider buying is particularly usable when the primary stock in question has seen transactions within the past 180 days. Over the latest half-year time period, Pengrowth Energy Corp (USA) (NYSE:PGH) has experienced zero unique insiders buying, and zero insider sales (see the details of insider trades here).
Let’s go over hedge fund and insider activity in other stocks similar to Pengrowth Energy Corp (USA) (NYSE:PGH). These stocks are EV Energy Partners, L.P. (NASDAQ:EVEP), Enerplus Corp (USA) (NYSE:ERF), Halcon Resources Corp (NYSE:HK), Kodiak Oil & Gas Corp (USA) (NYSE:KOG), and SandRidge Energy Inc. (NYSE:SD). All of these stocks are in the oil & gas drilling & exploration industry and their market caps are closest to PGH’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|EV Energy Partners, L.P. (NASDAQ:EVEP)||4||0||0|
|Enerplus Corp (USA) (NYSE:ERF)||7||0||0|
|Halcon Resources Corp (NYSE:HK)||16||0||0|
|Kodiak Oil & Gas Corp (USA) (NYSE:KOG)||22||0||6|
|SandRidge Energy Inc. (NYSE:SD)||28||2||5|
With the returns exhibited by Insider Monkey’s studies, retail investors must always watch hedge fund and insider trading activity, and Pengrowth Energy Corp (USA) (NYSE:PGH) is no exception.