Here’s Why These Five Stocks Are on the Move on Monday

It’s a green day on Wall Street as all three major indexes are in the green. The markets are also calm as the VIX fear index is below 14 and crude oil is up bytp around 2%. In this article, we take a closer look at some of the stocks more volatile than most today, including Transocean LTD (NYSE:RIG), Seadrill Ltd (NYSE:SDRL), Fairmount Santrol Holdings Inc (NYSE:FMSA), Chimera Investment Corporation (NYSE:CIM), and Yingli Green Energy Holding Co Ltd (ADR) (NYSE:YGE). We will also use 13-F filing data to see how the world’s greatest investors are positioned in each stock.

At Insider Monkey, we track around 760 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on, can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see the details here).

Offshore Drillers Surge on Rallying Crude Prices

It seems that traders are piling into the offshore drilling market today as Transocean LTD (NYSE:RIG) and Seadrill Ltd (NYSE:SDRL) are up by 10% and 8% respectively. Brent spot futures have popped 1.8% and are now above $50 per barrel in afternoon trading as some traders anticipate Friday’s dismal payroll report might lead the Federal Reserve to hold off on raising interest rates during this month’s FOMC meeting. If the Fed holds rates low, the U.S. dollar might not strengthen as much as expected, and crude prices could have more room to rally if various supply disruptions around the world continue. Although offshore drillers need considerably higher Brent prices than $50 for demand to meaningfully tick up, the sector has been beaten up and crude prices are notoriously difficult to predict. Carl Icahn’s Icahn Capital LP owned 21.4 million shares of Transocean LTD (NYSE:RIG) and Jim Simons’ Renaissance Technologies owned almost 1.5 million shares of Seadrill Ltd (NYSE:SDRL) at the end of March.

On the next page, we examine Fairmount Santrol Holdings, Chimera Investment Corporation, and Yingli Green Energy Holding.

Fairmount Santrol Rallies on Higher WTI

Shares of fracking sand supplier Fairmount Santrol Holdings Inc (NYSE:FMSA) have popped almost 16% today as traders pile into the name due to higher crude prices. With WTI prices near $50 per barrel and up around 2% so far, various fracking companies could drill more and demand for fracking sand could increase. Stronger demand could lead to more EBITDA for Fairmount. Morgan Stanley has a $9 price target. The number of funds from our database with holdings in Fairmount Santrol Holdings Inc (NYSE:FMSA) fell by three to six 6 during the first three months of 2016.

Chimera Investment Rises on Upgrade

Chimera Investment Corporation (NYSE:CIM) is 1% higher after analysts at Nomura raised their price target to $17 from $16 and kept their ‘Buy’ rating. The analysts like Chimera’s strong mid-teen return on equity and its ‘predominantly credit rather than rate sensitivity’. Shares of Chimera Investment Corporation (NYSE:CIM) have rallied almost 20% year-to-date and trade for a forward P/E of 7.44. The stock also pays a $0.48 quarterly dividend, which represents a 12.6% dividend yield at current prices. Of the around 766 elite funds we track, 12 funds owned $168.79 million worth of Chimera Investment Corporation (NYSE:CIM) shares, which accounted for 6.60% of the float on March 31, versus 14 funds and $232.31 million, respectively, on December 31.

Yingli Green Energy Surges on Guidance

Yingli Green Energy Holding Co Ltd (ADR) (NYSE:YGE) is 25% higher after the company announced its preliminary financial results for the first quarter of 2016. According to the company’s press release, Yingli expects net income for the quarter to turn positive for the first time since the third quarter of 2011, with an estimated net margin of 2.5% to 4.5%. Quarterly PV module shipments are expected to be between 500 and 510 MW and overall gross margin is expected to be in the range of 18.5% to 20.5%. The better margins are mainly the result of higher shipments in Japan, where the prices per watt are higher than other places in the world.

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