US stock markets were tumbling on Wednesday, with all major indexes down by at least 0.3%. In a day where markets were generally down, a few stocks stood out for their losses: Southwestern Energy Company (NYSE:SWN), Oasis Petroleum Inc. (NYSE:OAS), Inventergy Global Inc (NASDAQ:INVT), and Great Basin Scientific Inc (NASDAQ:GBSN). All of these stocks declined more than 6.5% on Wednesday, so let’s take a look into the developments that sent these stocks lower, and see what the funds from our database think about them.
At Insider Monkey, we track over 730 hedge funds and other institutional investors. By analyzing their quarterly 13F filings we determine the stocks that they are collectively bullish on, which allows us to mimic some of these picks and beat the market. Our focus is the small-cap picks of the investors we track and by imitating the 15 most popular small-cap stocks among these funds we have managed to generate returns of around 102% since August 2012, outperforming the S&P 500 ETF (SPY) by some 53 percentage points (see more details here).
First off, we’ll take a look at Southwestern Energy Company (NYSE:SWN) and Oasis Petroleum Inc. (NYSE:OAS), down roughly 7.1% and 6.7%, respectively, on lower oil prices. Both WTI and Brent slumped today following an Energy Information Administration report that showed a 2.6 million barrel increase in US crude inventories last week, compared to expectations of a 2.5 million barrel decline. In addition, Saudi Arabia, the largest exporter of crude oil in the world, said it had decided not to limit its production; this news also negatively impacted oil prices.
Despite the tough year energy stocks had, hedge funds seem to be confident in Southwestern Energy Company (NYSE:SWN). By the end of the third quarter, 38 funds among those we track were long the stock, up from 33 in the previous quarter. Interestingly, these institutional investors held 11.7% of the company’s total outstanding stock at the end of September, with Israel Englander’s Millennium Management being the most bullish – with more than 9.35 million shares, worth some $118 million.
The opposite was the case for Oasis Petroleum Inc. (NYSE:OAS), which saw the hedge fund interest decline during the third quarter. As of the end of the third quarter, 26 funds among those we track were long Oasis, versus 28 funds a quarter earlier. However, these 26 firms hold about 34.5% of the company’s outstanding stock as of the end of September. Despite a small reduction in its exposure, John H. Scully’s SPO Advisory Corp remained the largest shareholder of Oasis, holding 20.22 million shares, valued at more than $175 million.
On the next page, we are going to discuss the performance of the other two stocks, Inventergy Global and Great Basin Scientific.