With all three major indices now in the red in afternoon trading, HCA Holdings Inc (NYSE:HCA), Advanced Micro Devices, Inc. (NASDAQ:AMD), Radius Health Inc (NASDAQ:RDUS), and Tetraphase Pharmaceuticals Inc (NASDAQ:TTPH) are each on the move themselves. In this article, we take a deeper look at the catalysts causing investors to buy and sell these stocks in large quantities. Moreover, we will also examine relevant hedge fund sentiment towards each of these stocks.
Most investors don’t understand hedge funds and indicators that are based on hedge funds’ activities. They ignore hedge funds because of their recent poor performance in the bull market. Our research indicates that hedge funds underperformed because they aren’t 100% long. Hedge fund fees are also very large compared to the returns generated and they reduce the net returns experienced by investors. We uncovered that hedge funds’ long positions actually outperformed the market (see the details here). That’s why we believe investors should pay attention to what hedge funds are buying (rather than what their net returns are).
Going against the tide of red healthcare stocks today is HCA Holdings Inc (NYSE:HCA), whose shares are 6.4% in the green because of better-than-expected guidance. In a filing released on Friday after the market close, HCA Holdings Inc (NYSE:HCA) stated that it expects 2015 adjusted EBITDA to be $7.9 billion, or $0.1 billion higher than its previous guidance. Same facility admissions are expected to be 1.6% higher in the fourth quarter while same facility emergency room visits are expected to rise by 3.6% year-over-year. HCA will report its fourth quarter results on January 28.
Advanced Micro Devices, Inc. (NASDAQ:AMD) clawed back some of the losses it gave up in recent weeks today, as its shares are 7% higher in afternoon trading. Although there is no specific reason for the bullish move, short covering profit taking could have something to do with it. Even with today’s rally, Advanced Micro Devices, Inc. (NASDAQ:AMD) shares are still well below the $3.00 per share level that the stock achieved in late December. Hedge funds aren’t very optimistic on Advanced Micro Devices, as only 11 elite funds owned 0.5% of the stock’s float at the end of September.
On the next page, we examine why Radius Health Inc and Tetraphase Pharmaceuticals Inc. are moving.