Hedge Funds Are Buying These 6 Stocks with EPS Price Mismatches

Page 1 of 2

Hedge Funds Are Buying These 6 Stocks with EPS Price MismatchesLooking for stocks deeply undervalued to analyst expectations? If so, this stock list may be of interest to you:

The names below meet all of the following criteria:

- Market cap above $50 million

- Significantly net purchasing from hedge funds and other institutional buyers in the current quarter.

- Significant Earnings Per Share to Share Price Mismatch.

More information on these screens:

Institutional Buying

Because institutional investors handle such large amounts of money, it is easy enough to assume that they know what they’re doing — or at the very least know more than the average investor. This is why these investors are also sometimes referred to as “smart money.”

If institutional investors start investing in a company, regular investors can assume that some of the most talented analysts and money managers expect the company’s share prices to increase over time. The stocks on our list are experiencing significant investment from big money.

Significantly Undervalued to EPS Trends

We compared price trends to changes in EPS estimates over the last month.

Based on the assumption that P/E is equal to a constant k, increases in EPS should be matched by increases in price. When they don’t match up, a mispricing may have occurred.

We screened for stocks with faster growth in EPS estimates than price over the last month, which may indicate that these names are being undervalued. (A more comprehensive explanation can be found in this post.)

Business Section: Investing Ideas

Here’s the result of our screen. Look at the data below; Could a mispricing lead to positive upside for these names?

Use this list as a starting point for your own analysis. List Average 1-Year Return: 82%.

Interactive chart:  Compare changes in average analyst rating over the past two years

Hedge Funds Are Buying These 6 Stocks with EPS Price Mismatches

1. Abercrombie & Fitch Co. (NYSE:ANF) (EarningsAnalystsFinancials): Operates as a specialty retailer of casual apparel for men, women, and kids. Market cap at $3.75B, most recent closing price at $47.17.  Net institutional purchases in the current quarter at 4.5M shares, which represents about 6.15% of the company’s float of 73.19M shares. The EPS estimate for the company’s current year increased from 2.53 to 2.96 over the last 30 days, an increase of 17.%. This increase came during a time when the stock price changed by 12.05% (from 41.75 to 46.78 over the last 30 days).

Page 1 of 2
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

The 10 Most Peaceful Countries in the World

5 Big Reasons Communism Failed

The 15 Most Famous Carl Icahn Quotes

10 Scary Animals that are Actually Harmless

The 8 Most Famous Singer-Actors in Entertainment

The 10 Longest Wars of All Time

The 13 Worst Looking Foods that Taste Great

The 6 Most Gruesome Injuries Suffered During a Sports Match

The 20 Biggest Contracts in MLB History

The 7 Worst Blown Calls in Sports History

7 Free Ways to Advertise Your Business Online

The 18 Best R&B Songs of the 90’s

The 10 Most Dangerous States to be a Cop

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!