Precision Drilling Corp (USA) (NYSE:PDS) has experienced a decrease in support from the world’s most elite money managers lately.
According to most traders, hedge funds are seen as underperforming, old investment tools of years past. While there are more than 8000 funds in operation today, we at Insider Monkey choose to focus on the moguls of this club, about 450 funds. It is estimated that this group controls the majority of the hedge fund industry’s total capital, and by monitoring their best stock picks, we have spotted a number of investment strategies that have historically outperformed the market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points per year for a decade in our back tests, and since we’ve began to sharing our picks with our subscribers at the end of August 2012, we have trumped the S&P 500 index by 23.3 percentage points in 8 months (see the details here).
Just as beneficial, optimistic insider trading activity is another way to break down the marketplace. There are plenty of reasons for an insider to get rid of shares of his or her company, but just one, very obvious reason why they would buy. Plenty of empirical studies have demonstrated the valuable potential of this method if shareholders know where to look (learn more here).
Now, let’s take a glance at the key action surrounding Precision Drilling Corp (USA) (NYSE:PDS).
What have hedge funds been doing with Precision Drilling Corp (USA) (NYSE:PDS)?
At Q1’s end, a total of 11 of the hedge funds we track held long positions in this stock, a change of -31% from one quarter earlier. With hedge funds’ sentiment swirling, there exists a few key hedge fund managers who were boosting their stakes significantly.
Of the funds we track, Tetrem Capital Management, managed by Daniel Bubis, holds the biggest position in Precision Drilling Corp (USA) (NYSE:PDS). Tetrem Capital Management has a $59.2 million position in the stock, comprising 1.8% of its 13F portfolio. The second largest stake is held by Martin Whitman of Third Avenue Management, with a $30.7 million position; 0.6% of its 13F portfolio is allocated to the company. Other hedgies that hold long positions include Chuck Royce’s Royce & Associates, Cliff Asness’s AQR Capital Management and D. E. Shaw’s D E Shaw.
Because Precision Drilling Corp (USA) (NYSE:PDS) has experienced bearish sentiment from the entirety of the hedge funds we track, logic holds that there exists a select few funds who were dropping their entire stakes in Q1. It’s worth mentioning that Greg Boland’s West Face Capital cut the biggest position of the “upper crust” of funds we key on, valued at an estimated $41.4 million in stock., and Israel Englander of Millennium Management was right behind this move, as the fund sold off about $8.1 million worth. These bearish behaviors are interesting, as total hedge fund interest fell by 5 funds in Q1.
What have insiders been doing with Precision Drilling Corp (USA) (NYSE:PDS)?
Insider purchases made by high-level executives is best served when the primary stock in question has seen transactions within the past half-year. Over the latest half-year time frame, Precision Drilling Corp (USA) (NYSE:PDS) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to Precision Drilling Corp (USA) (NYSE:PDS). These stocks are CARBO Ceramics Inc. (NYSE:CRR), Energy XXI (Bermuda) Limited (NASDAQ:EXXI), Lufkin Industries, Inc. (NASDAQ:LUFK), Helix Energy Solutions Group Inc. (NYSE:HLX), and Forum Energy Technologies Inc (NYSE:FET). This group of stocks are the members of the oil & gas equipment & services industry and their market caps resemble PDS’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| CARBO Ceramics Inc. (NYSE:CRR) | 13 | 1 | 1 |
| Energy XXI (Bermuda) Limited (NASDAQ:EXXI) | 25 | 6 | 4 |
| Lufkin Industries, Inc. (NASDAQ:LUFK) | 13 | 0 | 2 |
| Helix Energy Solutions Group Inc. (NYSE:HLX) | 14 | 0 | 6 |
| Forum Energy Technologies Inc (NYSE:FET) | 4 | 0 | 7 |
With the returns demonstrated by Insider Monkey’s tactics, retail investors should always monitor hedge fund and insider trading sentiment, and Precision Drilling Corp (USA) (NYSE:PDS) shareholders fit into this picture quite nicely.
