After falling almost 1% in morning trading, the three indexes are trying to make a comeback of sorts. The Dow is off just 70 points, while the S&P is off 0.5%. Among the stocks performing worse than the three indexes are TETRA Technologies, Inc. (NYSE:TTI), Bellatrix Exploration Ltd (NYSE:BXE), Nike Inc (NYSE:NKE), Whiting Petroleum Corp (NYSE:WLL), and Transocean LTD (NYSE:RIG). In this article, we analyze why traders are selling these stocks and see what investors from our database think about these stocks.
Through extensive research, we determined that imitating some of the picks of hedge funds and other institutional investors can help generate market-beating returns over the long run. The key is to focus on the small-cap picks of these investors, since they are usually less followed by the broader market and are less price-efficient. Our backtests that covered the period between 1999 and 2012, showed that following the 15 most popular small-caps among hedge funds can help a retail investor beat the market by an average of 95 basis points per month (see the details here).
TETRA in the Red Due to Offering
TETRA Technologies, Inc. (NYSE:TTI) has commenced a public offering of around 10 million shares of common stock, along with granting underwriters a 30-day option to buy an additional 1.5 million shares. The company intends to use the net proceeds for general corporate purposes and to repay outstanding indebtedness under its senior secured notes. Shares of the company, which are down by 13% on the news, have also faced pressure due to the declining crude prices today. At the end of March, 15 funds tracked by us owned shares of TETRA Technologies, Inc. (NYSE:TTI) at the end of March, down by three funds from the previous quarter.
Bellatrix Declines Due to Asset Purchase
Bellatrix Exploration Ltd (NYSE:BXE)’s shares have retreated by almost 9% today after the company agreed to acquire complementary producing assets from Grafton Energy Co. The assets produced an average of 2,000 boe/d net to Grafton in the month of May, with 79% of the weighted production being natural gas. The total value of the acquisition is $29.2 million and will be paid for on a cash-free basis through the issuance of 20,547,576 Bellatrix common shares. Separately, Bellatrix has said the acquisition is expected to have ‘a positive effect’ on the company’s borrowing base redetermination, which should occur on June 30. Among the funds we track, six investors owned $47.03 million worth of Bellatrix Exploration Ltd (NYSE:BXE)’s stock, which accounted for 24.20% of the float on March 31, versus 10 funds and $77.4 million, respectively, on December 31.
On the next page, we examine Nike, Whiting Petroleum Corp, and Transocean LTD.