Billionaire Mason Hawkins Snapped Up One Stock During the Crash and Lost Confidence in Two Other Stocks

The recent stock market volatility has pushed some hedge fund investors and other money managers to adjust their portfolios. Just a few days ago, Mason Hawkins’ Southeastern Asset Management submitted three public filings with the U.S. Securities and Exchange Commission on three of its handful of positions. The following article will briefly discuss investment firm’s moves, and will also cover hedge fund sentiment on each of the stocks covered.

Professional investors like Mason Hawkins spend considerable time and money conducting due diligence on each company they invest in, which makes them the perfect investors to emulate. However, we also know that the returns of hedge funds and certain institutional investors on the whole have not been good for several years, underperforming the market. We analyzed the historical stock picks of these investors and our research revealed that the small-cap picks of these funds performed far better than their large-cap picks, which is where most of their money is invested and why their performances as a whole have been poor. Why pay fees to invest in both the best and worst ideas of a particular hedge fund when you can simply mimic the best ideas of the best fund managers on your own? A portfolio consisting of the 15 most popular small-cap stock picks among the funds we track has returned more than 102% and beaten the market by more than 53 percentage points since the end of August 2012 (see the details). So, we can definitely come up with promising investment ideas by following the moves of smart investors.

Southeastern Asset Management is global investment management firm founded in 1975. The Tennessee-based firm takes on a value-oriented approach to investing and focuses on a long-term time spectrum. Southeastern is led by CEO and Founder Mason Hawkins, whose investment style resembles the one of Warren Buffett. Southeastern Asset Management currenly oversees $26.7 billion in assets under management, while its equity portfolio has a market value of $14.95 billion as of June 30.

Let’s begin our discussion by looking at Southeastern Asset Management’s position in Murphy Oil Corporation (NYSE:MUR). A freshly-amended 13G filing disclosed that Mason Hawkins’ investment firm holds an ownership stake of 10.13 million shares in the oil and gas exploration and production company, accounting for 5.9% of its outstanding shares. This denotes a decrease of 4.82 million shares from the position disclosed in the 13F filing for the June quarter. The shares of Murphy Oil Corporation have lost more than 41% since the beginning of the year, and it appears that Mason Hawkins and his team have lost confidence in the energy stock. Meanwhile, 24 hedge funds monitored by Insider Monkey had positions in Murphy Oil Corporation (NYSE:MUR) at the end of the second quarter and amassed 13.00% of the company’s shares, compared with 23 investors registered in the prior quarter. However, the value of their investments decreased to $959.78 million from $1.07 billion during the three-month period, mainly owning to the poor stock performance. The stock lost nearly 11% during this time span. Pzena Investment Management, founded by Richard S. Pzena, is among the top stockholders of Murphy Oil Corporation (NYSE:MUR) with 4.67 million shares.

We can now turn the page and take a look at the other two moves made by Southeastern Asset Management.