Pioneer Energy Services Corp (NYSE:PES) investors should pay attention to stagnant enthusiasm from the smart money of late, which is a negative development in our experience.
According to most market participants, hedge funds are assumed to be slow, outdated investment tools of years past. While there are greater than 8000 funds trading today, we at Insider Monkey hone in on the top tier of this group, about 450 funds. It is estimated that this group oversees the majority of the smart money’s total capital, and by monitoring their top investments, we have revealed a few investment strategies that have historically beaten the market. Our small-cap hedge fund strategy outstripped the S&P 500 index by 18 percentage points annually 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 outpaced the S&P 500 index by 24 percentage points in 7 months (check out a sample of our picks).
Just as important, bullish insider trading activity is a second way to parse down the world of equities. Just as you’d expect, there are a variety of stimuli for an executive to sell shares of his or her company, but just one, very clear reason why they would initiate a purchase. Various empirical studies have demonstrated the market-beating potential of this method if shareholders understand what to do (learn more here).
With these “truths” under our belt, it’s important to take a peek at the key action surrounding Pioneer Energy Services Corp (NYSE:PES).
What have hedge funds been doing with Pioneer Energy Services Corp (NYSE:PES)?
Heading into 2013, a total of 8 of the hedge funds we track held long positions in this stock, a change of 0% from the third quarter. With the smart money’s sentiment swirling, there exists a select group of notable hedge fund managers who were boosting their stakes substantially.
Of the funds we track, Third Avenue Management, managed by Martin Whitman, holds the biggest position in Pioneer Energy Services Corp (NYSE:PES). Third Avenue Management has a $27.6 million position in the stock, comprising 0.6% of its 13F portfolio. Sitting at the No. 2 spot is Nokomis Capital, managed by Brett Hendrickson, which held a $10.9 million position; 3.7% of its 13F portfolio is allocated to the company. Some other hedgies that hold long positions include D. E. Shaw’s D E Shaw, Chuck Royce’s Royce & Associates and Ken Griffin’s Citadel Investment Group.
Judging by the fact that Pioneer Energy Services Corp (NYSE:PES) has faced bearish sentiment from the aggregate hedge fund industry, we can see that there was a specific group of fund managers who sold off their full holdings last quarter. It’s worth mentioning that Richard Driehaus’s Driehaus Capital sold off the biggest investment of the 450+ funds we monitor, comprising an estimated $1.1 million in stock.. Steven Cohen’s fund, SAC Capital Advisors, also said goodbye to its stock, 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).
How are insiders trading Pioneer Energy Services Corp (NYSE:PES)?
Insider buying is best served when the primary stock in question has experienced transactions within the past six months. Over the last 180-day time frame, Pioneer Energy Services Corp (NYSE:PES) has experienced 1 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 Pioneer Energy Services Corp (NYSE:PES). These stocks are Magnum Hunter Resources Corp (NYSE:MHR), Advantage Oil & Gas Ltd (USA) (NYSE:AAV), Vantage Drilling Company (NYSEAMEX:VTG), and Parker Drilling Company (NYSE:PKD). This group of stocks are in the oil & gas drilling & exploration industry and their market caps match PES’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|Magnum Hunter Resources Corp (NYSE:MHR)||6||2||3|
|Advantage Oil & Gas Ltd (USA) (NYSE:AAV)||5||0||0|
|Vantage Drilling Company (NYSEAMEX:VTG)||9||0||1|
|Parker Drilling Company (NYSE:PKD)||16||0||0|
With the results exhibited by Insider Monkey’s time-tested strategies, retail investors should always watch hedge fund and insider trading sentiment, and Pioneer Energy Services Corp (NYSE:PES) is an important part of this process.