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Arch Coal Inc (ACI), Vital Therapies Inc (VTL) Making Big Gains Today For Very Different Reasons

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The shares of Arch Coal Inc (NYSE:ACI) are trading 19.23% higher after a recent announcement from the company that it has again delayed its debt swap offer, this time to September 23 from August 28. In other news, the shares of Vital Therapies Inc (NASDAQ:VTL) have jumped by 15.54% following the company releasing additional study data for VTI-208, which is used in the treatment of liver diseases. We’ll take a look at the fundamentals and hedge fund sentiment on these two companies below.Mining Tunnel Coal

Let’s start with Arch Coal Inc, which has extended the end date for the 2020 Exchange Offer and the Concurrent Exchange Offer. In addition to these, the coal producer has extended the Early Tender Time for the Concurrent Exchange Offer to September 23 from August 28. The shares of the coal producer are down by a startling 94.49% year-to-date, despite the rise today. The precipitous decline forced the company to execute a 1-for-10 reverse stock split in July, as the threat of delistment from the NYSE loomed. Nonetheless, the smart money was maintaining a positive outlook for Arch Coal Inc (NYSE:ACI) as best they could during the second quarter, with their aggregate holdings declining by 52.80% while the shares of the company dropped by 66% during the quarter, showing that hedge funds added some shares to their coffers.

Why are we interested in the 13F filings of a select group of hedge funds? We use these filings to determine the top 15 small-cap stocks held by these elite funds based on 16 years of research that showed their top small-cap picks are much more profitable than both their large-cap stocks and the broader market as a whole. These small-cap stocks beat the S&P 500 Total Return Index by an average of nearly one percentage point per month in our backtests, which were conducted over the period of 1999 to 2012. Moreover, since the beginning of forward testing from August 2012, the strategy worked just as our research predicted, outperforming the market every year and returning 118% over the last 36 months, which is more than 60 percentage points higher than the returns of the S&P 500 ETF (SPY) (see more details).

Among the hedge funds that we track at Insider Monkey, DC Capital Partners was the largest shareholder of Arch Coal Inc (NYSE:ACI) at the end of the second quarter, holding 5.00 million shares. Israel Englander’s Millennium Management and D E Shaw, led by David E. Shaw, held significant stakes in the company as well, with 3.65 million shares and 2.79 million shares, respectively. Arrowstreet Capital initiated a new position comprising 931,821 shares valued at $317,000. On the other hand, Vollero Beach Capital Partners sold its entire stake in the company.

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