Capital World Investors Sold a Major Position in NBL in Q2


Aug. 27 2018, Updated 7:32 a.m. ET

NBL’s recent institutional activity

So far in this series, we’ve looked at institutional investments in five major oil-weighted E&P (exploration and production) stocks: ConocoPhillips (COP), EOG Resources (EOG), Occidental Petroleum (OXY), Anadarko Petroleum (APC), and Pioneer Natural Resources (PXD). In the next five articles, we’ll look at institutional investments in five major natural-gas-weighted E&P stocks, beginning with Noble Energy (NBL).

Capital World Investors sold a major position in Noble Energy in the second quarter, selling 41.8 million NBL shares for $1.5 billion. Capital World Investors was among the biggest buyers of major oil-weighted E&P stocks in Q2, which may suggest a shift from natural gas to crude oil.

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Capital World Investors was followed by Allan Gray Proprietary, which sold 4.1 million positions in NBL. Boston Partners and Fidelity Management & Research were NBL’s biggest buyers during the quarter, adding 2.9 million and 2.5 million positions, respectively. Among NBL’s top five buyers and sellers, 42.5 million positions were sold. This bearishness may be due to weak natural gas prices in the second quarter—the average price of natural gas fell year-over-year to $2.83 per MMBtu (million British thermal units) from $3.14 per MMBtu.

Top five holders

Capital Research Global Investors, The Vanguard Group, State Street Global Advisors, BlackRock Institutional Trust, and Artisan Partners are NBL’s top five institutional holders. Its largest investor, Capital Research Global Investors, holds 12.5% of the company.

Analysts’ recommendations

Of the analysts covering NBL, 65.6% recommend “buy,” and 34.4% recommend “hold.” Mizuho last downgraded NBL from “buy” to “neutral,” which is equivalent to “hold.” Over the past six months, NGL has seen six rating updates: four coverage initiations, one upgrade, and one downgrade. Analysts’ average target price of $43.20 implies a ~46% upside to its current price of $33.


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