Here’s Why These Five Stocks Are Trending

It’s another quiet day on Wall Street as all three indexes and crude futures are close to flat.

Among the stocks showing more volatility are Francesca’s Holdings Corp (NASDAQ:FRAN), The Valspar Corp (NYSE:VAL), HD Supply Holdings Inc (NASDAQ:HDS), Western Digital Corp (NASDAQ:WDC), and Sprouts Farmers Market Inc (NASDAQ:SFM). Without further ado, let’s take a closer look at why each stock is in the spotlight and see what the smart money investors from our database think about the companies in question.

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Francesca’s Beats

Francesca’s Holdings Corp (NASDAQ:FRAN) shares have surged this morning after the company reported better-than-expected earnings for its second quarter. During the quarter, Francesca’s earned $0.27 per share on revenue of $115.26 million, beating the consensus estimates by $0.09 and $6.1 million, respectively. Sales rose 8.7% year-over-year, while comparable sales were flat compared to the same period of the last year. Gross margin was 46.8%, down slightly from 47.4% a year ago.  For the full fiscal year ending January 28, management expects net sales in the range of $473 million to $488 million and EPS between $0.96 and $1.03. Jim Simons’ Renaissance Technologies raised its stake in Francesca’s  Holdings by 23% to over 1.8 million shares  in the second quarter.

Valspar Turns In Mixed Results

Although its fiscal third quarter earnings of $1.57 per share were ahead of analyst estimates by $0.12 per share, The Valspar Corp (NYSE:VAL)‘s revenue of $1.14 billion missed the consensus estimate by $40 million. Valspar sales inched lower by 0.9% year-over-year, as total volumes went up by 2% and foreign exchange had a negative 2% impact. Adjusted EBIT rose 7% as adjusted EBIT margin jumped to 15.2% from 11.7% over the year. Among the funds in our database, 25 funds owned shares of The Valspar Corp (NYSE:VAL) at the end of June, down by three funds from the previous quarter.

On the next page, we take a closer look at HD Supply Holdings, Western Digital Corp, and Sprouts Farmers Market.

HD Supply Misses the Mark

HD Supply Holdings Inc (NASDAQ:HDS) shares are deep in the red today after industrial distributor reported lackluster second-quarter results. In the three months, HD Supply earned $0.85 per share, missing analysts estimates by $0.03 per share. Revenue for the time period amounted to $2.02 billion, up by 4.1% year-over-year, but missing the consensus estimate by $10 million. For its third quarter, HD Supply Holdings’ management expects adjusted EPS of $0.77 to $0.82 on revenue of $1.985 billion to $2.035 billion. Of the around 750 investors we track, 47 funds owned shares of HD Supply Holdings Inc (NASDAQ:HDS) at the end of the second quarter.

Western Digital Raises Outlook

Traders are bidding Western Digital Corp (NASDAQ:WDC) higher today after the company raised its fiscal first quarter outlook for both EPS and sales. For the time quarter, Western Digital expects EPS between $1 and $1.05 versus the previous $0.85-$0.90. Revenue is expected in the range of $4.45 billion to $4.55 billion, up slightly from the previous range of $4.4 billion to $4.5 billion. Adjusted gross margin is also seen at 33% instead of the previous 32%. The company’s management has raised the outlook due to strong execution. A total of 48 funds out of those that we track owned shares of Western Digital Corp (NASDAQ:WDC) at the end of June, up by six from the previous quarter.

Sprouts Updates Guidance

In contrast to Western Digital, Sprouts Farmers Market Inc (NASDAQ:SFM) provided disappointing full 2016 guidance today. For the full year, the company expects EPS to be between $0.83 and $0.86 and comparable store sales growth of 1.5% to 2.5%. On the other hand, analysts were expecting EPS of $0.94. Management blames the deflationary environment and heavy promotions in the industry for the lack of better results. The number of investors from our database with holdings in Sprouts Farmers Market Inc (NASDAQ:SFM) advanced by four quarter-over-quarter to 22 at the end of June.

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