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What Hedge Funds Think About Baker Hughes Incorporated (BHI)

Baker Hughes Incorporated (NYSE:BHI) investors: listen up.

To many of your fellow readers, hedge funds are viewed as overrated, old investment tools of a period lost to current times. Although there are In excess of 8,000 hedge funds with their doors open today, Insider Monkey looks at the elite of this club, close to 525 funds. It is widely held that this group controls the lion’s share of the smart money’s total capital, and by monitoring their highest quality equity investments, we’ve deciphered a number of investment strategies that have historically beaten the broader indices. Our small-cap hedge fund strategy outperformed 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 outclassed the S&P 500 index by 33 percentage points in 11 months (explore the details and some picks here).

Equally as key, bullish insider trading activity is another way to analyze the investments you’re interested in. As the old adage goes: there are many incentives for an executive to drop shares of his or her company, but just one, very obvious reason why they would buy. Many academic studies have demonstrated the valuable potential of this strategy if you understand where to look (learn more here).

Thus, let’s discuss the latest info surrounding Baker Hughes Incorporated (NYSE:BHI).

How have hedgies been trading Baker Hughes Incorporated (NYSE:BHI)?

At the end of the second quarter, a total of 32 of the hedge funds we track were long in this stock, a change of 3% from the first quarter. With the smart money’s capital changing hands, there exists a select group of notable hedge fund managers who were boosting their holdings considerably.

Baker Hughes Incorporated (NYSE:BHI)Out of the hedge funds we follow, Natixis Global Asset Management’s Harris Associates had the biggest position in Baker Hughes Incorporated (NYSE:BHI), worth close to $487.9 million, accounting for 1% of its total 13F portfolio. On Harris Associates’s heels is Pzena Investment Management, managed by Richard S. Pzena, which held a $434.8 million position; the fund has 2.9% of its 13F portfolio invested in the stock. Remaining hedge funds with similar optimism include Edgar Wachenheim’s Greenhaven Associates, Alexander Roepers’s Atlantic Investment Management and Kerr Neilson’s Platinum Asset Management.

With a general bullishness amongst the titans, particular hedge funds were breaking ground themselves. Pzena Investment Management, managed by Richard S. Pzena, assembled the most valuable position in Baker Hughes Incorporated (NYSE:BHI). Pzena Investment Management had 434.8 million invested in the company at the end of the quarter. Edgar Wachenheim’s Greenhaven Associates also initiated a $372.1 million position during the quarter. The other funds with brand new BHI positions are Alexander Roepers’s Atlantic Investment Management, Kerr Neilson’s Platinum Asset Management, and Israel Englander’s Millennium Management.

How have insiders been trading Baker Hughes Incorporated (NYSE:BHI)?

Insider buying made by high-level executives is most useful when the company in question has seen transactions within the past half-year. Over the last half-year time frame, Baker Hughes Incorporated (NYSE:BHI) has seen zero unique insiders purchasing, and 5 insider sales (see the details of insider trades here).

We’ll check out the relationship between both of these indicators in other stocks similar to Baker Hughes Incorporated (NYSE:BHI). These stocks are Weatherford International Ltd (NYSE:WFT), Halliburton Company (NYSE:HAL), FMC Technologies, Inc. (NYSE:FTI), National-Oilwell Varco, Inc. (NYSE:NOV), and Cameron International Corporation (NYSE:CAM). All of these stocks are in the oil & gas equipment & services industry and their market caps are similar to BHI’s market cap.

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