Hedge Funds Are Buying Marathon Oil Corporation (MRO)

If a stock’s richest investors are buying a stock, shouldn’t you at least pay attention? That’s the story we face with Marathon Oil Corporation (NYSE:MRO).

To the average investor, there are dozens of indicators shareholders can use to analyze Mr. Market. Some of the best are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the elite investment managers can outclass the market by a very impressive margin (see just how much).

Equally as crucial, positive insider trading sentiment is a second way to look at the marketplace. As the old adage goes: there are lots of motivations for an upper level exec to cut shares of his or her company, but just one, very obvious reason why they would buy. Many empirical studies have demonstrated the valuable potential of this method if piggybackers understand where to look (learn more here).

Now that that’s out of the way, it’s important to discuss the newest info about Marathon Oil Corporation (NYSE:MRO).

Hedge fund activity in Marathon Oil Corporation (NYSE:MRO)

Heading into Q3, a total of 43 of the hedge funds we track held long positions in this stock, a change of 10% from one quarter earlier. With hedgies’ sentiment swirling, there exists an “upper tier” of notable hedge fund managers who were upping their stakes meaningfully.

According to our 13F database, Ken Griffin’s Citadel Investment Group had the biggest position in Marathon Oil Corporation (NYSE:MRO), worth close to $140.1 million, comprising 0.2% of its total 13F portfolio. On Citadel Investment Group’s heels is Cliff Asness of AQR Capital Management, with a $115.2 million position; the fund has 0.4% of its 13F portfolio invested in the stock. Other peers with similar optimism include Bernard Horn’s Polaris Capital Management, Clint Carlson’s Carlson Capital and Phill Gross and Robert Atchinson’s Adage Capital Management.

As aggregate interest spiked, certain bigger names were breaking ground themselves. Citadel Investment Group, managed by Ken Griffin, established the largest position in Marathon Oil Corporation (NYSE:MRO). Citadel Investment Group had 140.1 million invested in the company at the end of the quarter. Cliff Asness’s AQR Capital Management also initiated a $115.2 million position during the quarter. The other funds with new positions in the stock are Bernard Horn’s Polaris Capital Management, Clint Carlson’s Carlson Capital, and Phill Gross and Robert Atchinson’s Adage Capital Management.

Insider trading activity in Marathon Oil Corporation (NYSE:MRO)

Legal insider trading, particularly when it’s bullish, is at its handiest when the company in focus has seen transactions within the past 180 days. Over the latest half-year time period, Marathon Oil Corporation (NYSE:MRO) has seen zero unique insiders buying, and 2 insider sales (see the details of insider trades here).

We’ll also review the relationship between both of these indicators in other stocks similar to Marathon Oil Corporation (NYSE:MRO). These stocks are Ultrapar Participacoes SA (ADR) (NYSE:UGP), Imperial Oil Limited (USA) (NYSEAMEX:IMO), Marathon Petroleum Corp (NYSE:MPC), Valero Energy Corporation (NYSE:VLO), and Hess Corp. (NYSE:HES). This group of stocks are in the oil & gas refining & marketing industry and their market caps resemble MRO’s market cap.

Using the returns explained by our studies, regular investors must always keep one eye on hedge fund and insider trading sentiment, and Marathon Oil Corporation (NYSE:MRO) is an important part of this process.

Discover how hedge fund piggybacking can benefit you