Is Exxon Mobil Corporation (NYSE:XOM) undervalued? Money managers are reducing their bets on the stock. The number of bullish hedge fund positions decreased by 5 in recent months.
In today’s marketplace, there are a multitude of gauges investors can use to analyze Mr. Market. Some of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the top hedge fund managers can trounce the S&P 500 by a very impressive amount (see just how much).
Equally as beneficial, positive insider trading sentiment is another way to parse down the investments you’re interested in. As the old adage goes: there are lots of motivations for a corporate insider to get rid of shares of his or her company, but just one, very clear reason why they would buy. Various academic studies have demonstrated the impressive potential of this method if you know where to look (learn more here).
With all of this in mind, we’re going to take a glance at the latest action regarding Exxon Mobil Corporation (NYSE:XOM).
What does the smart money think about Exxon Mobil Corporation (NYSE:XOM)?
At the end of the fourth quarter, a total of 54 of the hedge funds we track were bullish in this stock, a change of -8% from the third quarter. With hedge funds’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were boosting their stakes substantially.
When looking at the hedgies we track, Bill & Melinda Gates Foundation Trust, managed by Michael Larson, holds the most valuable position in Exxon Mobil Corporation (NYSE:XOM). Bill & Melinda Gates Foundation Trust has a $662 million position in the stock, comprising 3.9% of its 13F portfolio. On Bill & Melinda Gates Foundation Trust’s heels is Phill Gross and Robert Atchinson of Adage Capital Management, with a $513 million position; 0.1% of its 13F portfolio is allocated to the stock. Other hedgies that are bullish include Ken Fisher’s Fisher Asset Management, Cliff Asness’s AQR Capital Management and Richard S. Pzena’s Pzena Investment Management.
Because Exxon Mobil Corporation (NYSE:XOM) has experienced bearish sentiment from the aggregate hedge fund industry, it’s safe to say that there exists a select few money managers that decided to sell off their entire stakes at the end of the year. Interestingly, Stanley Druckenmiller’s Duquesne Capital dropped the biggest position of the “upper crust” of funds we monitor, totaling an estimated $123 million in stock., and Perella Weinberg Partners was right behind this move, as the fund said goodbye to about $4 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest was cut by 5 funds at the end of the year.
How have insiders been trading Exxon Mobil Corporation (NYSE:XOM)?
Insider buying is particularly usable when the company we’re looking at has experienced transactions within the past 180 days. Over the last 180-day time frame, Exxon Mobil Corporation (NYSE:XOM) has seen 1 unique insiders buying, and 4 insider sales (see the details of insider trades here).
With the returns shown by the aforementioned studies, everyday investors should always keep an eye on hedge fund and insider trading sentiment, and Exxon Mobil Corporation (NYSE:XOM) is no exception.
Insider Monkey’s small-cap strategy returned 29.2% between September 2012 and February 2013 versus 8.7% for the S&P 500 index. Try it now by clicking the link above.