Markets opened higher on Wednesday as investors await the announcement regarding interest rate hike from the Federal Reserve today. Analysts think that the rate will be kept unchanged amid concerns about a U.S. hiring slowdown and the possibility of a Brexit. Some of the stocks trending today are Aegerion Pharmaceuticals, Inc. (NASDAQ:AEGR), QLT Inc. (USA) (NASDAQ:QLTI), Ebix Inc (NASDAQ:EBIX), Patriot National Inc (NYSE:PN), and Bank of America Corp (NYSE:BAC). Let’s find out why these stocks are on the move today and analyze the hedge fund sentiment towards these companies.
At Insider Monkey, we track around 765 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).
Aegerion Pharmaceuticals and QLT Announce Merger
Shares of Aegerion Pharmaceuticals, Inc. (NASDAQ:AEGR) and QLT Inc. (USA) (NASDAQ:QLTI) are in the spotlight today after both companies announced signing a merger agreement. According to the deal, each Aegerion share will be exchanged for 1.0256 shares of QLT. The combined company will be named Novelion Therapeutics after the closure of the deal. An investor syndicate has agreed to back the merger and invest $22 million in QLT. Novelion will have a balance of over $100 million after the merger. In a statement, Aegerion’s CEO Mary Szela said that the merger represents a “fresh start” and an opportunity to create more value for customers. Our data show that 14 hedge funds are long Aegerion Pharmaceuticals, Inc. (NASDAQ:AEGR) as of the end of the first quarter of 2016. Matt Sirovich and Jeremy Mindich’s Scopia Capital owns more than 5.70 million shares of the company. On the other hand, 17 hedge funds had positions in QLT Inc. (USA) (NASDAQ:QLTI) at the end of March. Mark Lampert’s Biotechnology Value Fund / BVF owns approximately 5.70 million shares of the company.
Ebix Bids to Acquire Patriot National
Ebix Inc (NASDAQ:EBIX) and Patriot National Inc (NYSE:PN) moved in the green, with Patriot National surging by over 30% after Ebix said in a statement that it had sent a letter to the board of directors of Patriot National offering to acquire the latter for $9.50 per share. The Atlanta-based software company’s offer represents a 37% premium to Patriot’s closing price on Tuesday. Ebix’s statement said that the merged entity would become the world’s largest company providing insurance services, on-demand based front and backend systems, exchanges, strategic consulting and risk compliance services. As of the end of March, 12 hedge funds from our database were bullish on Ebix Inc (NASDAQ:EBIX). Claus Moller’s P2 Capital Partners has more than 1.67 million shares of the company. On the other hand, Patriot National has been overlooked by most smart money investors we track, with John Overdeck and David Siegel’s Two Sigma Advisors being one of the few funds invested in the stock with 57,400 shares held at the end of March.
On the next page, we will see why Bank of America is making headlines today.