Is Chesapeake Energy Corporation (CHK) A Good Stock To Buy?

Legendary investors such as Leon Cooperman and Seth Klarman earn enormous amounts of money for themselves and their investors by doing in-depth research on small-cap stocks that big brokerage houses don’t publish. Small cap stocks -especially when they are screened well- can generate substantial outperformance versus a boring index fund. That’s why we analyze the activity of those elite funds in these small-cap stocks. In the following paragraphs, we analyze Chesapeake Energy Corporation (NYSE:CHK) from the perspective of those elite funds.

Chesapeake Energy Corporation was in 34 hedge funds’ portfolios at the end of the third quarter of 2015. CHK investors should pay attention to an increase in hedge fund sentiment lately. There were 33 hedge funds in our database with CHK holdings at the end of the previous quarter. At the end of this article we will also compare CHK to other stocks including RenaissanceRe Holdings Ltd. (NYSE:RNR), National Retail Properties, Inc. (NYSE:NNN), and People’s United Financial, Inc. (NASDAQ:PBCT) to get a better sense of its popularity.

Now, let’s take a look at the key action surrounding Chesapeake Energy Corporation (NYSE:CHK).

What does the smart money think about Chesapeake Energy Corporation (NYSE:CHK)?

Heading into Q4, a total of 34 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 3% from the second quarter. With hedgies’ sentiment swirling, there exists an “upper tier” of key hedge fund managers who were upping their holdings significantly (or already accumulated large positions).

When looking at the institutional investors followed by Insider Monkey, Carl Icahn’s Icahn Capital LP has the most valuable position in Chesapeake Energy Corporation (NYSE:CHK), worth close to $535.5 million, comprising 1.9% of its total 13F portfolio. The second most bullish fund manager is Southeastern Asset Management, managed by Mason Hawkins, which holds a $424.4 million position; 3.6% of its 13F portfolio is allocated to the company. Other members of the smart money that hold long positions include Robert Pitts’s Steadfast Capital Management, and Christian Leone’s Luxor Capital Group.