We at Insider Monkey have gone over 821 13F filings that hedge funds and prominent investors are required to file by the SEC The 13F filings show the funds' and investors' portfolio positions as of March 31st, near the height of the coronavirus market crash. In this article, we look at what those funds think of Oasis Midstream Partners LP (NYSE:OMP) based on that data.
Is Oasis Midstream Partners LP (NYSE:OMP) a buy right now? Money managers are in a bearish mood. The number of long hedge fund bets retreated by 1 lately. Our calculations also showed that OMP isn't among the 30 most popular stocks among hedge funds (click for Q1 rankings and see the video for a quick look at the top 5 stocks). OMP was in 3 hedge funds' portfolios at the end of March. There were 4 hedge funds in our database with OMP positions at the end of the previous quarter.
Video: Watch our video about the top 5 most popular hedge fund stocks.
In today’s marketplace there are a lot of methods investors can use to appraise stocks. A pair of the most useful methods are hedge fund and insider trading signals. Our researchers have shown that, historically, those who follow the top picks of the best fund managers can outperform their index-focused peers by a healthy amount (see the details here).
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Paul Marshall of Marshall Wace[/caption]
At Insider Monkey we leave no stone unturned when looking for the next great investment idea. For example, legendary investor Bill Miller told investors to sell 7 extremely popular recession stocks last month. So, we went through his list and recommended another stock with 100% upside potential instead. We interview hedge fund managers and ask them about their best ideas. You can watch our latest hedge fund manager interview here and find out the name of the large-cap healthcare stock that Sio Capital's Michael Castor expects to double. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. Now we're going to check out the recent hedge fund action encompassing Oasis Midstream Partners LP (NYSE:OMP).
How are hedge funds trading Oasis Midstream Partners LP (NYSE:OMP)?
Heading into the second quarter of 2020, a total of 3 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -25% from the previous quarter. The graph below displays the number of hedge funds with bullish position in OMP over the last 18 quarters. With the smart money's sentiment swirling, there exists a select group of noteworthy hedge fund managers who were adding to their stakes considerably (or already accumulated large positions).
More specifically, Marshall Wace LLP was the largest shareholder of Oasis Midstream Partners LP (NYSE:OMP), with a stake worth $1.4 million reported as of the end of September. Trailing Marshall Wace LLP was Arrowstreet Capital, which amassed a stake valued at $1.4 million. Citadel Investment Group was 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 EJF Capital allocated the biggest weight to Oasis Midstream Partners LP (NYSE:OMP), around 0.02% of its 13F portfolio. Marshall Wace LLP is also relatively very bullish on the stock, earmarking 0.01 percent of its 13F equity portfolio to OMP.
We view hedge fund activity in the stock unfavorable, but in this case there was only a single hedge fund selling its entire position: Voss Capital. One hedge fund selling its entire position doesn't always imply a bearish intent. Theoretically a hedge fund may decide to sell a promising position in order to invest the proceeds in a more promising idea. However, we don't think this is the case in this case because none of the 750+ hedge funds tracked by Insider Monkey identified OMP as a viable investment and initiated a position in the stock.
Let's go over hedge fund activity in other stocks similar to Oasis Midstream Partners LP (NYSE:OMP). These stocks are Immersion Corporation (NASDAQ:IMMR), Concrete Pumping Holdings, Inc. (NASDAQ:BBCP), Fossil Group Inc (NASDAQ:FOSL), and Smith Micro Software, Inc. (NASDAQ:SMSI). This group of stocks' market caps are closest to OMP's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position IMMR,11,64426,-3 BBCP,8,34588,2 FOSL,9,21846,-5 SMSI,9,4953,1 Average,9.25,31453,-1.25 [/table]
View table here if you experience formatting issues.
As you can see these stocks had an average of 9.25 hedge funds with bullish positions and the average amount invested in these stocks was $31 million. That figure was $3 million in OMP's case. Immersion Corporation (NASDAQ:IMMR) is the most popular stock in this table. On the other hand Concrete Pumping Holdings, Inc. (NASDAQ:BBCP) is the least popular one with only 8 bullish hedge fund positions. Compared to these stocks Oasis Midstream Partners LP (NYSE:OMP) is even less popular than BBCP. Hedge funds clearly dropped the ball on OMP as the stock delivered strong returns, though hedge funds' consensus picks still generated respectable returns. Our calculations showed that top 10 most popular stocks among hedge funds returned 41.4% in 2019 and outperformed the S&P 500 ETF (SPY) by 10.1 percentage points. These stocks gained 7.9% in 2020 through May 22nd and still beat the market by 15.6 percentage points. A small number of hedge funds were also right about betting on OMP as the stock returned 90.7% so far in the second quarter and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published at Insider Monkey.