Cheap, High Dividend Oil and Gas Stock Beloved by Hedge Funds

YPF Sociedad Anonima (NYSE:YPF) is an Argentina-based integrated oil and gas player and the country's biggest energy company. It operates in about 70 oil and gas fields with proven reserves of over 500 million barrels of oil and over 2000 billion cubic feet of gas.

The company also sells automotive petroleum products through 1,632 YPF-branded service stations. Since the latest 13F filings, the company also announced the discovery of approximately 150 billion barrels of oil deposits in southwestern Argentina. Click to enlarge:

What’s interesting is that as recently as 2 quarters ago, this stock was only reported by 11 13F filers whose holdings amounted to less than $6BN of the company’s $17BN market cap:

As of the Q1 2011 filing, however, we see that a number of prominent hedge funds have rushed into this stock. Below is a list of the top 15 filers as of Q1 2011 with their holdings over time (). As you can see, this stock was only recently discovered by the hedge fund community:

Eric Mindich’s Eton Park Capital Management made a big entry into it at the end of 2010 and held $435M as of Q1 representing its 3rd largest position:

Capital International Inc, the mega-large Canadian mutual fund shop, has a similarly bold bet on YPF:

Continuing down the list we see that “Tiger Cub” Robert Citrone's hedge fund Discovery Capital has almost $100M in YPF representing his 6th largest position as of Q1 2011 after a brief stint in 2010. Jabre Capital, Third Point, Passport Capital, QVT Financial, Rima Mgmt, Citadel, TPG-Axon, David Knott (proprietor of very successful value hedge fund Knott Partners), Moore Capital, Everest Capital, Marathon Asset Mgmt, Renaissance, AQR…and on and on.

Clearly the hedge fund community is seeing value in YPF Sociedad Anonima. The company currently pays approximately an 8.3% dividend (which is up significantly in recent days on a stock selloff), has a forward P/E ratio of 9.13 and an Enterprise Value/EBITDA ratio of only 4.86.
Now might be the right time to take advantage of a market selloff to pick up this cheap energy stock with a high dividend and a lot of hedge fund interest.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

This article was written by

AlphaStratus is a leading provider of 13F software that gives investors the data and tools to efficiently and comprehensively analyze 13F information. Transparency among hedge funds remains poor making it more important than ever for investors to leverage available sources of information to extract the intelligence necessary to make informed decisions. AlphaStratus serves hedge funds, fund of funds and family offices. Visit or email for more.

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