Here is What Hedge Funds Think About Energy XXI (Bermuda) Limited (EXXI)

Energy XXI (Bermuda) Limited (NASDAQ:EXXI) was in 25 hedge funds’ portfolio at the end of March. EXXI investors should be aware of an increase in hedge fund sentiment of late. There were 23 hedge funds in our database with EXXI positions at the end of the previous quarter.

In today’s marketplace, there are plenty of gauges market participants can use to monitor publicly traded companies. A pair of the most underrated are hedge fund and insider trading sentiment. At Insider Monkey, our studies have shown that, historically, those who follow the top picks of the elite investment managers can beat the S&P 500 by a solid amount (see just how much).

Just as integral, bullish insider trading activity is another way to break down the stock market universe. There are many motivations for an upper level exec to downsize shares of his or her company, but only one, very simple reason why they would buy. Plenty of academic studies have demonstrated the impressive potential of this method if investors know where to look (learn more here).

With all of this in mind, it’s important to take a gander at the recent action regarding Energy XXI (Bermuda) Limited (NASDAQ:EXXI).

How are hedge funds trading Energy XXI (Bermuda) Limited (NASDAQ:EXXI)?

In preparation for this quarter, a total of 25 of the hedge funds we track were bullish in this stock, a change of 9% from one quarter earlier. With hedgies’ positions undergoing their usual ebb and flow, there exists a few notable hedge fund managers who were boosting their stakes significantly.

According to our comprehensive database, Mark McGoldrick and Jason Maynard’s Mouth Kellett Capital Management had the most valuable position in Energy XXI (Bermuda) Limited (NASDAQ:EXXI), worth close to $161.2 million, accounting for 21% of its total 13F portfolio. The second largest stake is held by SAC Capital Advisors, managed by Steven Cohen, which held a $79.7 million position; 0.4% of its 13F portfolio is allocated to the stock. Some other hedge funds that are bullish include Leon Cooperman’s Omega Advisors, Malcolm Fairbairn’s Ascend Capital and Ken Griffin’s Citadel Investment Group.

Consequently, key hedge funds were leading the bulls’ herd. Ascend Capital, managed by Malcolm Fairbairn, assembled the most outsized position in Energy XXI (Bermuda) Limited (NASDAQ:EXXI). Ascend Capital had 35.9 million invested in the company at the end of the quarter. Tom Wagner and Ara Cohen’s Knighthead Capital also initiated a $17.3 million position during the quarter. The other funds with new positions in the stock are Cliff Asness’s AQR Capital Management, David Dreman’s Dreman Value Management, and Glenn Russell Dubin’s Highbridge Capital Management.

How have insiders been trading Energy XXI (Bermuda) Limited (NASDAQ:EXXI)?

Insider buying is most useful when the primary stock in question has seen transactions within the past six months. Over the latest half-year time period, Energy XXI (Bermuda) Limited (NASDAQ:EXXI) has seen 6 unique insiders buying, and 4 insider sales (see the details of insider trades here).

Let’s go over hedge fund and insider activity in other stocks similar to Energy XXI (Bermuda) Limited (NASDAQ:EXXI). These stocks are Forum Energy Technologies Inc (NYSE:FET), Precision Drilling Corp (USA) (NYSE:PDS), Helix Energy Solutions Group Inc. (NYSE:HLX), Lufkin Industries, Inc. (NASDAQ:LUFK), and CARBO Ceramics Inc. (NYSE:CRR). This group of stocks are in the oil & gas equipment & services industry and their market caps resemble EXXI’s market cap.