Although the masses and most of the financial media blame hedge funds for their exorbitant fee structure and disappointing performance, these investors have proved to have great stock picking abilities over the years (that’s why their assets under management continue to swell). We believe hedge fund sentiment should serve as a crucial tool of an individual investor’s stock selection process, as it may offer great insights of how the brightest minds of the finance industry feel about specific stocks. After all, these people have access to the smartest analysts and expensive data/information sources that individual investors can’t match. So should one consider investing in OGE Energy Corp. (NYSE:OGE)? The smart money sentiment can provide an answer to this question.
OGE Energy Corp. (NYSE:OGE) has experienced an increase in support from the world’s most elite money managers lately. OGE Energy Corp. (NYSE:OGE) was in 21 hedge funds’ portfolios at the end of the third quarter of 2021. The all time high for this statistic is 25. Our calculations also showed that OGE isn’t among the 30 most popular stocks among hedge funds (click for Q2 rankings).
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium prices have more than doubled over the past year, so we go through lists like the 10 best EV stocks to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. With all of this in mind we’re going to take a peek at the new hedge fund action surrounding OGE Energy Corp. (NYSE:OGE).
Sander Gerber of Hudson Bay Capital
Do Hedge Funds Think OGE Is A Good Stock To Buy Now?
At third quarter’s end, a total of 21 of the hedge funds tracked by Insider Monkey were long this stock, a change of 24% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards OGE over the last 25 quarters. So, let’s examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically, Millennium Management was the largest shareholder of OGE Energy Corp. (NYSE:OGE), with a stake worth $56.3 million reported as of the end of September. Trailing Millennium Management was ExodusPoint Capital, which amassed a stake valued at $33.5 million. Zimmer Partners, Point72 Asset Management, and Renaissance Technologies were also very fond of the stock, becoming one of the largest hedge fund holders of the company. In terms of the portfolio weights assigned to each position Coann Capital allocated the biggest weight to OGE Energy Corp. (NYSE:OGE), around 7.66% of its 13F portfolio. Zimmer Partners is also relatively very bullish on the stock, setting aside 0.52 percent of its 13F equity portfolio to OGE.
Now, key money managers have jumped into OGE Energy Corp. (NYSE:OGE) headfirst. Hudson Bay Capital Management, managed by Sander Gerber, created the most valuable position in OGE Energy Corp. (NYSE:OGE). Hudson Bay Capital Management had $2.8 million invested in the company at the end of the quarter. Paul Tudor Jones’s Tudor Investment Corp also initiated a $2.2 million position during the quarter. The other funds with new positions in the stock are John Overdeck and David Siegel’s Two Sigma Advisors, Peter Algert’s Algert Global, and Greg Eisner’s Engineers Gate Manager.
Let’s check out hedge fund activity in other stocks – not necessarily in the same industry as OGE Energy Corp. (NYSE:OGE) but similarly valued. These stocks are J2 Global Inc (NASDAQ:JCOM), Appian Corporation (NASDAQ:APPN), Huntsman Corporation (NYSE:HUN), Sprout Social, Inc. (NASDAQ:SPT), RenaissanceRe Holdings Ltd. (NYSE:RNR), Brixmor Property Group Inc (NYSE:BRX), and Skechers USA Inc (NYSE:SKX). This group of stocks’ market valuations resemble OGE’s market valuation.
| Ticker | No of HFs with positions | Total Value of HF Positions (x1000) | Change in HF Position |
|---|---|---|---|
| JCOM | 20 | 410631 | -2 |
| APPN | 20 | 610244 | 7 |
| HUN | 26 | 984953 | -1 |
| SPT | 29 | 595106 | 4 |
| RNR | 31 | 473877 | 0 |
| BRX | 24 | 246523 | 3 |
| SKX | 35 | 744486 | 0 |
| Average | 26.4 | 580831 | 1.6 |
View table here if you experience formatting issues.
As you can see these stocks had an average of 26.4 hedge funds with bullish positions and the average amount invested in these stocks was $581 million. That figure was $225 million in OGE’s case. Skechers USA Inc (NYSE:SKX) is the most popular stock in this table. On the other hand J2 Global Inc (NASDAQ:JCOM) is the least popular one with only 20 bullish hedge fund positions. OGE Energy Corp. (NYSE:OGE) is not the least popular stock in this group but hedge fund interest is still below average. Our overall hedge fund sentiment score for OGE is 37.5. Stocks with higher number of hedge fund positions relative to other stocks as well as relative to their historical range receive a higher sentiment score. Our calculations showed that top 5 most popular stocks among hedge funds returned 95.8% in 2019 and 2020, and outperformed the S&P 500 ETF (SPY) by 40 percentage points. These stocks gained 29.6% in 2021 and still beat the market by 3.6 percentage points. A small number of hedge funds were also right about betting on OGE as the stock returned 17.9% since the end of the third quarter (through 12/31) and outperformed the market by an even larger margin.
Follow Oge Energy Corp. (NYSE:OGE)
Follow Oge Energy Corp. (NYSE:OGE)
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Disclosure: None. This article was originally published at Insider Monkey.
