Is Pengrowth Energy Corp (USA) (NYSE:PGH) an exceptional investment right now? Prominent investors are getting more bullish. The number of long hedge fund positions improved by 2 recently.
To most traders, hedge funds are viewed as slow, outdated financial vehicles of years past. While there are more than 8000 funds trading at present, we at Insider Monkey choose to focus on the aristocrats of this group, about 450 funds. Most estimates calculate that this group controls most of the hedge fund industry’s total asset base, and by paying attention to their top stock picks, we have deciphered a few investment strategies that have historically beaten the S&P 500 index. Our small-cap hedge fund strategy beat the S&P 500 index by 18 percentage points annually for a decade in our back tests, and since we’ve started sharing our picks with our subscribers at the end of August 2012, we have outclassed the S&P 500 index by 24 percentage points in 7 months (see the details here).
Just as integral, bullish insider trading activity is another way to break down the stock market universe. Obviously, there are plenty of motivations for a bullish insider to get rid of shares of his or her company, but just one, very clear reason why they would initiate a purchase. Several academic studies have demonstrated the valuable potential of this tactic if “monkeys” know what to do (learn more here).
Consequently, let’s take a peek at the latest action encompassing Pengrowth Energy Corp (USA) (NYSE:PGH).
Hedge fund activity in Pengrowth Energy Corp (USA) (NYSE:PGH)
Heading into 2013, a total of 8 of the hedge funds we track were bullish in this stock, a change of 33% from the previous quarter. With hedge funds’ capital changing hands, there exists a few key hedge fund managers who were boosting their holdings significantly.
According to our comprehensive database, Royce & Associates, managed by Chuck Royce, holds the largest position in Pengrowth Energy Corp (USA) (NYSE:PGH). Royce & Associates has a $5.7 million position in the stock, comprising less than 0.1%% of its 13F portfolio. Sitting at the No. 2 spot is Sprott Asset Management, managed by Eric Sprott, which held a $3.1 million position; the fund has 0.4% of its 13F portfolio invested in the stock. Remaining hedgies that hold long positions include Brian Stark’s Stark Investments, Ken Griffin’s Citadel Investment Group and Jim Simons’s Renaissance Technologies.
As aggregate interest increased, key hedge funds were breaking ground themselves. Stark Investments, managed by Brian Stark, established the most outsized position in Pengrowth Energy Corp (USA) (NYSE:PGH). Stark Investments had 2.3 million invested in the company at the end of the quarter. D. E. Shaw’s D E Shaw also made a $0.2 million investment in the stock during the quarter. The only other fund with a new position in the stock is Neil Chriss’s Hutchin Hill Capital.
What do corporate executives and insiders think about Pengrowth Energy Corp (USA) (NYSE:PGH)?
Insider purchases made by high-level executives is particularly usable when the company in question has seen transactions within the past 180 days. Over the latest six-month time period, Pengrowth Energy Corp (USA) (NYSE:PGH) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
Let’s also take a look at hedge fund and insider activity in other stocks similar to Pengrowth Energy Corp (USA) (NYSE:PGH). These stocks are EV Energy Partners, L.P. (NASDAQ:EVEP), Enerplus Corp (USA) (NYSE:ERF), Halcon Resources Corp (NYSE:HK), Kodiak Oil & Gas Corp (USA) (NYSE:KOG), and SandRidge Energy Inc. (NYSE:SD). All of these stocks are in the oil & gas drilling & exploration industry and their market caps resemble PGH’s market cap.
