Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Here’s Why Mobileye, Fitbit, & More are in the Red Today

Page 1 of 2

With all three indexes in the green today, shares of Mobileye NV (NYSE:MBLY), Fitbit Inc (NYSE:FIT), Gladstone Capital Corporation (NASDAQ:GLAD), and ZIOPHARM Oncology Inc. (NASDAQ:ZIOP) are heading in the opposite direction. Let’s take a closer look at why the four stocks are among today’s biggest losers. In addition, let’s analyze the latest trading action of elite investors in these stocks, if relevant.

Hedge fund sentiment is an important metric for assessing the long-term profitability. At Insider Monkey, we track over 700 hedge funds, whose quarterly 13F filings we analyze and determine their collective sentiment towards several thousand stocks. However, our research has shown that the best strategy is to follow hedge funds into their small-cap picks. This approach can allow monthly returns of nearly 95 basis points above the market, as we determined through extensive backtests covering the period between 1999 and 2012 (see the details here).

Mobileye NV (NYSE:MBLY) shares have fallen by over 10% this morning after Morgan Stanley’s Adam Jonas lowered his price target on the stock to $57 from $80. Although Jonas kept his ‘Overweight’ rating on the stock, his bear case is now $20 per share versus the previous $30 per share. Jonas had this to say in regards to his thinking:

“Although advanced ADAS penetration could lead to earnings growth, large tech players add potential risk to Mobileye’s market share, margins and terminal growth rate. While we continue to believe that Mobileye is in pole position to lead the next wave of advancements, we have revised our forecasts to show a greater awareness of the competitive landscape that is taking form.”

Last month, Citron Research labled Mobileye NV (NYSE:MBLY) as the ‘short of the year’ for 2016 because of future competition and valuation concerns. Given the trend of more autonomous cars, other players such as Alphabet Inc (NASDAQ:GOOG) and car makers from Detroit will grab market-share over the next few years. Silicon Valley start-ups, such as the one founded by 26 year-old hacker George Hotz, could eventually give Mobileye a run for its money too. According to our data, hedge funds were becoming less optimistic about the stock, as the number of smart money shareholders of Mobileye fell by seven to 32 during the third quarter.

Fitbit Inc (NYSE:FIT) can’t escape the GoPro Inc (NASDAQ:GPRO) comparisons, as shares of the wearable tech company are off by 4.79% this morning on worries that it will also face commoditization, lower margins, and weaker sales due to increased competition. Like GoPro, Fitbit Inc (NYSE:FIT) is somewhat of a ‘fad’ stock, with its EPS and revenue rising rapidly as consumers snap up the company’s ‘it’ products. Investors are selling today because they fear that Fitbit’s fundamentals might deteriorate if the company loses that ‘must have’ status. GoPro has largely lost that status, after the company warned that its fourth-quarter results will be worse than expected. Because of soft demand, GoPro now anticipates sales of $435 million for the quarter, substantially below its previous guidance of $500 million-to-$550 million and analyst expectations of $511.9 million.

20 elite funds held 2.4% of Fitbit’s shares as of the latest 13F reporting period. That’s down from 27 elite funds that held shares on June 30.

Follow Fitbit Inc (NYSE:FIT)
Trade (NYSE:FIT) Now!

On the next page, we examine the sliding shares of Gladstone Capital Corporation and ZIOPHARM Oncology Inc.

Page 1 of 2

Biotech Stock Alert - 20% Guaranteed Return in One Year

Hedge Funds and Insiders Are Piling Into

One of 2015's best hedge funds and two insiders snapped up shares of this medical device stock recently. We believe its transformative and disruptive device will storm the $3+ billion market and help it achieve 500%-1000% gains in 3 years.

Get your FREE REPORT and the details of our 20% return guarantee today.

Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.
Loading Comments...
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 102% in 3 years!! Wondering How?

Download a complete edition of our newsletter for free!