Red Dead Tease Has Take-Two in the Green, Plus 4 Other Hot Stocks

The markets are trading in negative territory today despite strong factory production data and a solid quarterly earnings announcement from Bank of America. The negative sentiment could be due to the Fed raising a warning about persistent low interest rates, which could be interpreted to signal an upcoming interest rate hike.

The markets are also being affected by several stocks making moves today. Some of the prominent stocks moving the markets today are Golar LNG Limited (USA) (NASDAQ:GLNG), Groupon Inc. (NASDAQ:GRPN), ICICI Bank Ltd (ADR) (NYSE:IBN), Take-Two Interactive Software Inc. (NASDAQ:TTWO), and Quality Systems Inc. (NASDAQ:QSII). In this article, we’ll discuss the news behind these stocks’ moves and take a look at what hedge funds think of each stock.

Imitating hedge funds and other institutional investors can help identify some of the most profitable stocks on the market. However, our extensive research that covered the period between 1999 and 2012, showed that the best approach is to follow these investors into their small-cap stocks. Our backtests showed that the 15 most popular small-cap stocks among hedge funds managed to generate a monthly alpha of 81 basis points, versus an alpha of 0.7 percentage points posted by their top 50 large-cap picks (see more details here).

Golar LNG Limited (USA) (NASDAQ:GLNG) is trading up by 2.90% after Golar Power, of which it owns 50%, announced the inking of a 25-year FSRU deal, reaching its final investment decision on the Porto de Sergipe Project, which entails the project company, CELSE, entering into a lump sum turnkey EPC agreement with General Electric Company (NYSE:GE) for the construction, maintenance and operation of a 1.5 GW combined cycle power plant in Brazil. The deal is expected to contribute $39 million in annual EBITDA. Golar Power owns 50% of the Sergipe Project, up from 25% owned previously. Among the funds that we track, 20 were long $268 million worth of Golar LNG Limited (USA) (NASDAQ:GLNG)’s stock at the end of June, having amassed 18.50% of its outstanding shares.

Groupon Inc. (NASDAQ:GRPN)‘s stock is 1.6% in the green on the news of a rating upgrade from Wedbush. The stock is now rated ‘Outperform’, up from its previous rating of ‘Neutral’. The firm’s price target on the stock was also raised to $6.50 from $4.50. Wedbush’s report states that the stock has upside potential as the company’s deal inventory is steadily improving. In addition, Groupon is undervalued compared to its peers and its website is experiencing an increase in traffic. The number of funds from within our hedge fund database long Groupon Inc. (NASDAQ:GRPN) stood at 23 at the end of June.

Three more of the market’s big movers are discussed on the next page.

ICICI Bank Ltd (ADR) (NYSE:IBN) is trading up by 5% on Monday thanks to the banking company being likely to benefit from the Essar-Rosneft deal, which saw Russia’s Rosneft PJSC buy Essar Oil’s Vadinar refinery for $13 billion. The bank is expected to get a large chunk of its loans to Essar repaid thanks to the windfall, while the remaining portion of the debt is likely to be assumed by the buyer. Essar Group has approximately $17 billion in debt, with ICICI Bank being one of its largest lenders. 20 hedge funds in our database had long positions in ICICI Bank Ltd (ADR) (NYSE:IBN) on June 30, valued at $332 million.

Take-Two Interactive Software Inc. (NASDAQ:TTWO)‘s stock has shot up by 6% after the company teased a new game release from its Rockstar Games studio. The teaser image tweeted out is likely hinting at a sequel to the highly popular 2010 game ‘Red Dead Redemption’ and its lesser-known precursor Red Dead Revolver, the PS2 version of which just happened to get re-released on the PlayStation 4 last week. Red Dead Redemption sold over 14 million copies worldwide. 47 hedge funds that we track held about $989 million worth of Take-Two Interactive Software Inc. (NASDAQ:TTWO)’s stock at he end of June, accounting for almost 30.80% of its float.

Quality Systems Inc. (NASDAQ:QSII) is trading 8% in the green as speculation that the company is exploring a potential sale surfaced over the weekend. It is believed that the company has retained UBS for the purpose of vetting out potential deals. The company is also said to have made presentations to several suitors. 13 hedge funds in our database held about $27 million worth of Quality Systems Inc. (NASDAQ:QSII)’s stock as of the end of the June quarter.

Disclosure: None