One of the great maxims of traders and Wall Street pros is to follow the "smart money."

I'm not much for the thesis that institutional shoppers tend to make smarter investing decisions, but many of you who've read my ruminations on insider buying say you'd also like to know how the Big Money is betting. Your wish is my command.

Next up: ATP Oil & Gas (Nasdaq: ATPG). Are institutions bullish or bearish when it comes to this acquirer and manager of oil- and gas-producing properties?

Foolish facts


ATP Oil & Gas

CAPS stars (out of 5) *****
Total ratings 1,271
Percent bulls 97.2%
Percent bears 2.8%
Bullish pitches 167 out of 171
Highest-rated peers Devon Energy, Anadarko Petroleum, Apache

Data current as of Nov. 2.

Shares of ATP Oil & Gas may be down 22% year-to-date, but ask Fools what they think of the company's prospects now that a ban on drilling has been lifted and they'll tell you the stock is due for a rally.

"The company announced first production at its second Telemark well. The first zone is already producing at 7,000 [barrels of oil equivalent] per day (this is an oil well) and they will be commingling this with a second zone, which should push total production to 10,000 BOE or more," wrote All-Star investor AAOI, quoting a write-up by Devon Shire of the blog Canadian Value.

He goes on to estimate ATP's revenue and cash flow could increase 65% just by virtue of turning on the spigot at one new well. Analysts have ATP nearly doubling revenue next year and boosting per-share earnings by 15% annually over the next five years. All signs point to this stock as a growth story in the making.

Institutional ownership history

Top Owners





Aletheia Research & Mgmt. - - 5,078,283 5,675,906
BlackRock 972,325 1,287,510 2,921,977 3,354,313
Centennial Energy Partners 4,393,562 4,093,862 4,228,807 3,039,322
SG Gestion - - 982,238 2,437,928
The Vanguard Group 884,153 845,128 2,236,523 1,931,294
TOP 25 TOTAL 8,287,866 8,805,978 20,833,503 25,739,039

Source: Capital IQ, a division of Standard & Poor's.
*Number of shares owned.

Institutions find that alluring even if short-sellers don't. More than 11 million shares of ATP were sold short as of late June, Capital IQ reports. Today, the total's closer to 19 million shares. Bears are growling.

And if they're wrong? If bullish investors such as Devon Shire prove correct in estimating ATP's growth opportunity? These short-sellers would be forced to cover in a massive short squeeze.

Wall Street appears to be betting on exactly that sort of outcome. As a group, the top 25 institutional owners of ATP Oil & Gas have bought shares in every quarter dating back to March 2009.

Competitor and peer checkup


Institutional Ownership

Insider Ownership

ATP Oil & Gas 38.75% 13.19%
Callon Petroleum (NYSE: CPE) 58.93% 3.16%
Energy Partners (NYSE: EPL) 38.60% 0.43%
Forest Oil 94.19% 6.04%
Helix Energy Solutions (NYSE: HLX) 77.87% 6.73%
Newfield Exploration 87.46% 1.67%
Noble Energy (NYSE: NBL) 88.86% 1.04%
Plains Exploration & Prod. (NYSE: PXP) 71.36% 2.07%
Stone Energy (NYSE: SGY) 80.56% 1.93%

Source: Capital IQ. Data current as of Nov. 2.

ATP looks to me like the most attractive bet in this table. Not only is there a potential catalyst in newly operating wells, but also, founder and CEO T. Paul Bulmahn still owns 11.7% of the business. If the Big Money wins, so will he. That's a good combination that I'm taking advantage of by rating ATP to outperform in CAPS.

Now it's your turn to weigh in. Do you think the institutions are wrong about ATP Oil & Gas? Let us know what you think using the comments box below. You can also recommend other stocks for Tim to evaluate by sending him an email, or replying to him on Twitter.

Interested in more info on ATP Oil & Gas? Add it to your watchlist here by clicking here.

Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He didn't own shares in any of the companies mentioned in this article at the time of publication. Check out Tim's portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool. You can also get his insights delivered directly to your RSS reader. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool is also on Twitter as @TheMotleyFool. Its disclosure policy is smarter than the average bear.