What’s Making Institution Investors Bullish on Encana

ECA’s recent institutional activity

Fidelity Management & Research added a major position in Encana (ECA) during the second quarter, buying 22.7 million ECA shares for $296.9 million. Point72 Asset Management followed, adding 8 million positions. Meanwhile, Causeway Capital Management and Viking Global Investors, the biggest sellers, sold 10.3 million and 9.8 million ECA shares, respectively. Among ECA’s top five buyers and sellers, 5.3 million net positions were added, indicating bullishness. Institutional investors’ bullishness towards ECA could be due to the following factors:

  • strong Permian production growth
  • high average realized oil prices—the average realized crude oil price was $70.20 per barrel in the second quarter
  • improved margins

What’s Making Institution Investors Bullish on Encana

Top five holders

Viking Global Investors, Davis Selected Advisers, Causeway Capital Management, Fidelity Management & Research, and The Vanguard Group are ECA’s top five institutional holders. Viking Global Investors has remained ECA’s largest institutional holder, despite unloading 9.8 million shares. It holds 7.4% of the company.

Analysts’ recommendations

Of the analysts covering ECA, 92.9% recommend “buy,” and 7.1% recommend “hold.” Their average target price of $17.40 for ECA implies a ~36% upside to its current price of $14.25.