Oil States International, Inc. (OIS): Are Hedge Funds Right About This Stock?

The latest 13F reporting period has come and gone, and Insider Monkey is again at the forefront when it comes to making use of this gold mine of data. We at Insider Monkey have plowed through 866 13F filings that hedge funds and well-known value investors are required to file by the SEC. The 13F filings show the funds’ and investors’ portfolio positions as of March 31st. In this article we look at what those investors think of Oil States International, Inc. (NYSE:OIS).

Is Oil States International, Inc. (NYSE:OIS) a first-rate investment right now? The smart money was in an optimistic mood. The number of long hedge fund bets increased by 4 in recent months. Oil States International, Inc. (NYSE:OIS) was in 17 hedge funds’ portfolios at the end of the first quarter of 2021. The all time high for this statistic is 18. Our calculations also showed that OIS isn’t among the 30 most popular stocks among hedge funds (click for Q1 rankings).

If you’d ask most traders, hedge funds are perceived as underperforming, old financial tools of years past. While there are greater than 8000 funds trading at the moment, Our experts look at the upper echelon of this group, about 850 funds. These money managers manage the lion’s share of all hedge funds’ total capital, and by paying attention to their matchless investments, Insider Monkey has figured out various investment strategies that have historically defeated the market. Insider Monkey’s flagship short hedge fund strategy beat the S&P 500 short ETFs by around 20 percentage points annually since its inception in March 2017. Also, our monthly newsletter’s portfolio of long stock picks returned 206.8% since March 2017 (through May 2021) and beat the S&P 500 Index by more than 115 percentage points. You can download a sample issue of this newsletter on our website .

Gavin Saitowitz of Prelude Capital

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, pet market is growing at a 7% annual rate and is expected to reach $110 billion in 2021. So, we are checking out the 5 best stocks for animal lovers. We go through lists like the 15 best Jim Cramer stocks to identify the next Tesla that will deliver outsized returns. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our homepage. Now let’s take a look at the key hedge fund action surrounding Oil States International, Inc. (NYSE:OIS).

Do Hedge Funds Think OIS Is A Good Stock To Buy Now?

Heading into the second quarter of 2021, a total of 17 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 31% from the previous quarter. By comparison, 12 hedge funds held shares or bullish call options in OIS a year ago. With hedgies’ capital changing hands, there exists an “upper tier” of notable hedge fund managers who were boosting their stakes considerably (or already accumulated large positions).

The largest stake in Oil States International, Inc. (NYSE:OIS) was held by Arrowstreet Capital, which reported holding $4.8 million worth of stock at the end of December. It was followed by Two Sigma Advisors with a $4.4 million position. Other investors bullish on the company included Intrinsic Edge Capital, Citadel Investment Group, and AQR Capital Management. In terms of the portfolio weights assigned to each position Nierenberg Investment Management allocated the biggest weight to Oil States International, Inc. (NYSE:OIS), around 0.14% of its 13F portfolio. Intrinsic Edge Capital is also relatively very bullish on the stock, designating 0.12 percent of its 13F equity portfolio to OIS.

Now, key money managers have jumped into Oil States International, Inc. (NYSE:OIS) headfirst. Intrinsic Edge Capital, managed by Mark Coe, established the most valuable position in Oil States International, Inc. (NYSE:OIS). Intrinsic Edge Capital had $1.8 million invested in the company at the end of the quarter. Greg Eisner’s Engineers Gate Manager also made a $0.5 million investment in the stock during the quarter. The other funds with brand new OIS positions are Gavin Saitowitz and Cisco J. del Valle’s Prelude Capital (previously Springbok Capital), Peter Muller’s PDT Partners, and Vince Maddi and Shawn Brennan’s SIR Capital Management.

Let’s now review hedge fund activity in other stocks – not necessarily in the same industry as Oil States International, Inc. (NYSE:OIS) but similarly valued. We will take a look at SciPlay Corporation (NASDAQ:SCPL), Future FinTech Group Inc. (NASDAQ:FTFT), The9 Limited (NASDAQ:NCTY), Itamar Medical Ltd. (NASDAQ:ITMR), Bioceres Crop Solutions Corp. (NASDAQ:BIOX), Carter Bankshares, Inc. (NASDAQ:CARE), and Global Water Resources, Inc. (NASDAQ:GWRS). This group of stocks’ market caps are similar to OIS’s market cap.

View table here if you experience formatting issues.

As you can see these stocks had an average of 8.6 hedge funds with bullish positions and the average amount invested in these stocks was $31 million. That figure was $18 million in OIS’s case. SciPlay Corporation (NASDAQ:SCPL) is the most popular stock in this table. On the other hand Future FinTech Group Inc. (NASDAQ:FTFT) is the least popular one with only 2 bullish hedge fund positions. Oil States International, Inc. (NYSE:OIS) is not the most popular stock in this group but hedge fund interest is still above average. Our overall hedge fund sentiment score for OIS is 73. 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. This is a slightly positive signal but we’d rather spend our time researching stocks that hedge funds are piling on. 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 28.5% in 2021 through July 23rd and beat the market again by 10.1 percentage points. Unfortunately OIS wasn’t nearly as popular as these 5 stocks and hedge funds that were betting on OIS were disappointed as the stock returned -1.8% since the end of March (through 7/23) and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out the top 5 most popular stocks among hedge funds as many of these stocks already outperformed the market since 2019.

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Disclosure: None. This article was originally published at Insider Monkey.