Devon Energy Corp (NYSE:DVN) investors should pay attention to an increase in activity from the world’s largest hedge funds in recent months.
If you’d ask most stock holders, hedge funds are seen as slow, old investment vehicles of the past. While there are more than 8000 funds with their doors open at present, we at Insider Monkey choose to focus on the top tier of this club, about 450 funds. It is estimated that this group has its hands on the majority of the hedge fund industry’s total asset base, and by paying attention to their best picks, we have identified a few investment strategies that have historically outperformed the market. Our small-cap hedge fund strategy outperformed the S&P 500 index by 18 percentage points per annum 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 23.3 percentage points in 8 months (see the details here).
Equally as integral, positive insider trading activity is a second way to parse down the marketplace. As the old adage goes: there are a number of stimuli for an insider to get rid of shares of his or her company, but just one, very simple reason why they would behave bullishly. Several academic studies have demonstrated the useful potential of this tactic if “monkeys” know where to look (learn more here).
Keeping this in mind, let’s take a peek at the key action surrounding Devon Energy Corp (NYSE:DVN).
What does the smart money think about Devon Energy Corp (NYSE:DVN)?
In preparation for this quarter, a total of 45 of the hedge funds we track held long positions in this stock, a change of 5% from the previous quarter. With hedgies’ capital changing hands, there exists a few key hedge fund managers who were increasing their stakes meaningfully.
Of the funds we track, Jean-Marie Eveillard’s First Eagle Investment Management had the largest position in Devon Energy Corp (NYSE:DVN), worth close to $449.3 million, comprising 1.5% of its total 13F portfolio. On First Eagle Investment Management’s heels is Charles de Vaulx of International Value Advisers, with a $318.6 million position; the fund has 7.3% of its 13F portfolio invested in the stock. Some other hedgies that hold long positions include Edgar Wachenheim’s Greenhaven Associates, Martin Whitman’s Third Avenue Management and Ric Dillon’s Diamond Hill Capital.
As one would reasonably expect, key hedge funds have jumped into Devon Energy Corp (NYSE:DVN) headfirst. Samlyn Capital, managed by Robert Pohly, assembled the most outsized position in Devon Energy Corp (NYSE:DVN). Samlyn Capital had 28.4 million invested in the company at the end of the quarter. Curtis Macnguyen’s Ivory Capital (Investment Mgmt) also made a $24.1 million investment in the stock during the quarter. The other funds with brand new DVN positions are Dmitry Balyasny’s Balyasny Asset Management, Joshua Friedman and Mitchell Julis’s Canyon Capital Advisors, and Michael Platt and William Reeves’s BlueCrest Capital Mgmt..
How have insiders been trading Devon Energy Corp (NYSE:DVN)?
Insider trading activity, especially when it’s bullish, is particularly usable when the primary stock in question has seen transactions within the past 180 days. Over the latest half-year time period, Devon Energy Corp (NYSE:DVN) has seen zero unique insiders buying, and 2 insider sales (see the details of insider trades here).
Let’s check out hedge fund and insider activity in other stocks similar to Devon Energy Corp (NYSE:DVN). These stocks are EOG Resources Inc (NYSE:EOG), Continental Resources, Inc. (NYSE:CLR), Pioneer Natural Resources (NYSE:PXD), Apache Corporation (NYSE:APA), and Noble Energy, Inc. (NYSE:NBL). This group of stocks belong to the independent oil & gas industry and their market caps are similar to DVN’s market cap.
| Company Name | # of Hedge Funds | # of Insiders Buying | # of Insiders Selling |
| EOG Resources Inc (NYSE:EOG) | 40 | 0 | 6 |
| Continental Resources, Inc. (NYSE:CLR) | 26 | 1 | 8 |
| Pioneer Natural Resources (NYSE:PXD) | 40 | 0 | 14 |
| Apache Corporation (NYSE:APA) | 41 | 5 | 1 |
| Noble Energy, Inc. (NYSE:NBL) | 27 | 0 | 8 |
With the returns shown by our research, retail investors must always watch hedge fund and insider trading activity, and Devon Energy Corp (NYSE:DVN) is no exception.
