Weatherford International Ltd (NYSE:WFT) could be seeing its stock oversold, according to some metrics. The stock has lost about 12 percent over the last month, countering a year-to-date bull run of nearly 30 percent. The stock was given a “hold” rating by several analysts recently, and the company last month announced a $253 million resolution of investigations by the SEC and the U.S. Department of Justice. Even in the three weeks since the, however, the sock has continued to drop. Does this signal a new buying opportunity? Investors in Weatherford International Ltd (NYSE:WFT) have experienced an increase in hedge fund interest in recent months.
What have hedge funds been doing with Weatherford International Ltd (NYSE:WFT)?
At the end of the third quarter, 40 of the hedge funds tracked at Insider Monkey were bullish in this stock, a strong 43-percent increase from the second quarter. With the smart money’s positions undergoing their usual ebb and flow, there exists an “upper tier” of noteworthy hedge fund managers who were increasing their holdings considerably.
According to hedge fund intelligence website Insider Monkey, William B. Gray’s Orbis Investment Management had the biggest position in Weatherford International Ltd (NYSE:WFT), worth close to $843.7 million, amounting to 6.3 percent of its total 13F portfolio. Sitting at the No. 2 spot is Mario Gabelli of GAMCO Investors, with a $164.8-million position; 1 percent of its 13F portfolio is allocated to the stock. Other hedge funds with similar optimism contain Israel Englander’s Millennium Management and Steven Cohen’s SAC Capital Advisors.
Consequently, some big names have been driving this bullishness. Sigma Capital Management, managed by SAC Subsidiary, established the most outsized position in Weatherford International Ltd (NYSE:WFT). Sigma Capital Management had $29.1 million invested in the company at the end of the quarter. Anand Parekh’s Alyeska Investment Group also initiated a $28.4-million position during the quarter. The other funds with new positions in the stock are Nick Niell’s Arrowgrass Capital Partners, Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital, and Jorge Paulo Lemann’s 3G Capital.
What do insiders think about Weatherford International Ltd (NYSE:WFT)?
Bullish insider trading is best served when the primary stock in question has seen transactions within the past 180 days. Over the latest six-month time frame, Weatherford International Ltd (NYSE:WFT) has seen two unique insider buys and four insider sales (see the details of insider trades here).
Let’s also review hedge fund and insider activity in other stocks similar to Weatherford International Ltd (NYSE:WFT). These stocks are MDU Resources Group Inc (NYSE:MDU), Cameron International Corporation (NYSE:CAM), Core Laboratories N.V. (NYSE:CLB), FMC Technologies, Inc. (NYSE:FTI), and Oceaneering International (NYSE:OII). These stocks are the members of the oil and gas equipment and services industry and their market caps resemble WFT’s market cap.
|Company Name||# of Hedge Funds||# of Insiders Buying||# of Insiders Selling|
|MDU Resources Group Inc (NYSE:MDU)||14||3||2|
|Cameron International Corporation (NYSE:CAM)||40||0||2|
|Core Laboratories N.V. (NYSE:CLB)||13||0||3|
|FMC Technologies, Inc. (NYSE:FTI)||22||0||1|
|Oceaneering International (NYSE:OII)||28||0||1|
Thanks to the bullish response of hedge funds, Weatherford International Ltd (NYSE:WFT) is now the top choice among hedge funds, sharing the pedestal with Comeron International Corporation (NYSE:CAM). The company is also generating the most insider activity among the group, just ahead of MDU Resources Group Inc (NYSE:MDU).