What Hedge Funds Think About Murphy Oil Corporation (MUR)

Is Murphy Oil Corporation (NYSE:MUR) a buy?

In the financial world, there are many methods investors can use to watch publicly traded companies. Some of the most innovative are hedge fund and insider trading movement. At Insider Monkey, our research analyses have shown that, historically, those who follow the top picks of the elite fund managers can beat the market by a healthy margin (see just how much).

Just as crucial, optimistic insider trading activity is a second way to analyze the marketplace. There are plenty of incentives for an upper level exec to sell shares of his or her company, but just one, very obvious reason why they would behave bullishly. Several academic studies have demonstrated the valuable potential of this strategy if “monkeys” know what to do (learn more here).

Thus, we’re going to examine the newest info surrounding Murphy Oil Corporation (NYSE:MUR).

How have hedgies been trading Murphy Oil Corporation (NYSE:MUR)?

In preparation for the third quarter, a total of 21 of the hedge funds we track were bullish in this stock, a change of -9% from the previous quarter. With the smart money’s sentiment swirling, there exists a select group of noteworthy hedge fund managers who were upping their holdings meaningfully.

According to our 13F database, Mason Hawkins’s Southeastern Asset Management had the most valuable position in Murphy Oil Corporation (NYSE:MUR), worth close to $977.9 million, accounting for 4.8% of its total 13F portfolio. Sitting at the No. 2 spot is William B. Gray of Orbis Investment Management, with a $120.4 million position; 1% of its 13F portfolio is allocated to the stock. Remaining hedge funds that are bullish include Cliff Asness’s AQR Capital Management, and Israel Englander’s Millennium Management.

Because Murphy Oil Corporation (NYSE:MUR) has experienced bearish sentiment from the smart money’s best and brightest, we can see that there exists a select few hedgies that slashed their entire stakes last quarter. Intriguingly, Dan Loeb’s Third Point said goodbye to the largest position of the 450+ funds we track, valued at close to $159.3 million in stock, and Dmitry Balyasny of Balyasny Asset Management was right behind this move, as the fund cut about $12.7 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest fell by 2 funds last quarter.

What have insiders been doing with Murphy Oil Corporation (NYSE:MUR)?

Legal insider trading, particularly when it’s bullish, is at its handiest when the company we’re looking at has experienced transactions within the past half-year. Over the latest half-year time frame, Murphy Oil Corporation (NYSE:MUR) has experienced 1 unique insiders buying, and 10 insider sales (see the details of insider trades here).

We’ll also take a look at the relationship between both of these indicators in other stocks similar to Murphy Oil Corporation (NYSE:MUR). These stocks are Marathon Oil Corporation (NYSE:MRO), Access Midstream Partners LP (NYSE:ACMP), Tesoro Corporation (NYSE:TSO), HollyFrontier Corp (NYSE:HFC), and Ultrapar Participacoes SA (ADR) (NYSE:UGP). This group of stocks are the members of the oil & gas refining & marketing industry and their market caps are similar to MUR’s market cap.

Using the returns demonstrated by our analyses, average investors should always keep one eye on hedge fund and insider trading sentiment, and Murphy Oil Corporation (NYSE:MUR) shareholders fit into this picture quite nicely.

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