EOG Resources Inc (EOG): Striking It Rich With These Hedge Funds?

EOG Resources Inc (NYSE:EOG) is riding high on crude oil and aims to become the largest producer of crude oil not only in the Lower 48 but all of the U.S. Not satisfied with being No. 1 in Texas, the company has set its eyes on the top spot in the U.S. With total oil production growing at a 43-percent annual rate over the last three years, the company is looking to break some records. Many wells have already achieved 100-percent rates of return and new techniques have helped EOG Resources Inc to increase output. The third quarter also saw revenues from the main contributor – crude oil and condensate – rise by 55 percent. The company is targeting a 39-percent growth target in crude oil and condensate production.

Hedge funds betting on EOG Resources Inc

It seems that many of the hedge funds had an inclination about the results of the third quarter. The number of hedge funds bullish on the company increased from 48 in the second quarter to 57 at the end of the third quarter, an increase of almost 19 percent.

Ken Griffin’s Citadel Investment Group has the largest exposure to EOG Resources Inc (NYSE:EOG) with $318.9 million representing 0.5 percent of its portfolio riding on the company. Another hedge fund with good exposure is Ric Dillion-managed Diamond Hill Capital with $238.4 million or 2.4 percent of its total portfolio. Other notable hedgies include Phill Gross and Robert Atchinson’s Adage Capital Management, Steven Cohen’s SAC Capital Advisors and Sean Cullinan’s Point State Capital.

Not willing to be left out of the action, nine hedge funds have built new positions in EOG Resources Inc (NYSE:EOG), notably Cobalt Capital Management, managed by Wayne Cooperman, with an investment of $46.7 million in the third quarter. Vince Maddi and Shawn Brennan’s SIR Capital Management also made a $40.2-million investment in the stock during the quarter. Other funds building new positions in the company are Alec Litowitz and Ross Laser’s Magnetar Capital, Anand Parekh’s Alyeska Investment Group, and Paul Jasinkiewicz’s Jasinkiewicz Capital Management.

EOG Resources Inc (NYSE:EOG)

Are the insiders supporting the action?

Insider trading activity, especially when it’s bullish, is best served when the primary stock in question has experienced transactions within the past 180 days. Over the last 180-day time frame, EOG Resources Inc (NYSE:EOG) has seen zero unique insiders buying, and 9 insider sales (see the details of insider trades here).

Comparison with EOG Resources’s peers in the same industry – independent oil and gas – and with similar market capitalization can give us some good leads. The companies identified on this basis are Devon Energy Corp (NYSE:DVN), Suncor Energy Inc. (USA) (NYSE:SU), Anadarko Petroleum Corporation (NYSE:APC), Apache Corporation (NYSE:APA), and Canadian Natural Resource Ltd (USA) (NYSE:CNQ).

Company Name # of Hedge Funds # of Insiders Buying # of Insiders Selling
Devon Energy Corp (NYSE:DVN) 44 0 1
Suncor Energy Inc. (USA) (NYSE:SU) 30 0 0
Anadarko Petroleum Corporation (NYSE:APC) 74 0 5
Apache Corporation (NYSE:APA) 45 2 5
Canadian Natural Resource Ltd (USA) (NYSE:CNQ) 28 0 0

Anadarko Petroleum Corporation (NYSE:APC) attracted more hedge funds than EOG Resources Inc (NYSE:EOG). Both Anadarko Petroleum Corporation and Apache Corporation (NYSE:APA) were favored by insiders.


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