Is Enterprise Products Partners L.P. (NYSE:EPD) a cheap investment right now? Money managers are taking a bearish view. The number of bullish hedge fund bets were cut by 3 in recent months.
At the moment, there are plenty of indicators market participants can use to monitor stocks. A couple of the most underrated are hedge fund and insider trading movement. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the top hedge fund managers can beat the market by a very impressive amount (see just how much).
Equally as important, positive insider trading activity is a second way to break down the financial markets. Obviously, there are many motivations for a corporate insider to sell shares of his or her company, but only one, very obvious reason why they would buy. Plenty of academic studies have demonstrated the useful potential of this method if investors understand what to do (learn more here).
Keeping this in mind, we’re going to take a gander at the key action regarding Enterprise Products Partners L.P. (NYSE:EPD).
How are hedge funds trading Enterprise Products Partners L.P. (NYSE:EPD)?
At the end of the fourth quarter, a total of 9 of the hedge funds we track were long in this stock, a change of -25% from the previous quarter. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were upping their stakes substantially.
Of the funds we track, Renaissance Technologies, managed by Jim Simons, holds the most valuable position in Enterprise Products Partners L.P. (NYSE:EPD). Renaissance Technologies has a $86.2 million position in the stock, comprising 0.3% of its 13F portfolio. On Renaissance Technologies’s heels is Osterweis Capital Management, managed by John Osterweis, which held a $62.2 million position; 2.8% of its 13F portfolio is allocated to the company. Remaining peers that hold long positions include Richard Driehaus’s Driehaus Capital, William Harnisch’s Peconic Partners LLC and Ken Griffin’s Citadel Investment Group.
Since Enterprise Products Partners L.P. (NYSE:EPD) has witnessed declining sentiment from the entirety of the hedge funds we track, we can see that there were a few hedge funds who were dropping their entire stakes heading into 2013. It’s worth mentioning that Dmitry Balyasny’s Balyasny Asset Management sold off the biggest stake of all the hedgies we track, comprising about $8 million in stock., and Noam Gottesman of GLG Partners was right behind this move, as the fund dropped about $3.4 million worth. These moves are intriguing to say the least, as total hedge fund interest was cut by 3 funds heading into 2013.
What do corporate executives and insiders think about Enterprise Products Partners L.P. (NYSE:EPD)?
Insider purchases made by high-level executives is most useful when the primary stock in question has seen transactions within the past half-year. Over the last 180-day time period, Enterprise Products Partners L.P. (NYSE:EPD) has experienced zero unique insiders purchasing, and 4 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 Enterprise Products Partners L.P. (NYSE:EPD). These stocks are EOG Resources Inc (NYSE:EOG), Canadian Natural Resource Ltd (USA) (NYSE:CNQ), CNOOC Limited (ADR) (NYSE:CEO), Anadarko Petroleum Corporation (NYSE:APC), and Suncor Energy Inc. (USA) (NYSE:SU). This group of stocks are in the independent oil & gas industry and their market caps match EPD’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| EOG Resources Inc (NYSE:EOG) | 41 | 0 | 8 |
| Canadian Natural Resource Ltd (USA) (NYSE:CNQ) | 29 | 0 | 0 |
| CNOOC Limited (ADR) (NYSE:CEO) | 10 | 0 | 0 |
| Anadarko Petroleum Corporation (NYSE:APC) | 62 | 0 | 2 |
| Suncor Energy Inc. (USA) (NYSE:SU) | 27 | 0 | 0 |
With the returns shown by our strategies, everyday investors should always pay attention to hedge fund and insider trading sentiment, and Enterprise Products Partners L.P. (NYSE:EPD) is no exception.
