Although the S&P 500 is up just 0.3% and the NASDAQ is up 0.5%, shares of five companies, J C Penney Company Inc (NYSE:JCP), Freeport-McMoRan Inc (NYSE:FCX), LendingClub Corp (NYSE:LC), MGT Capital Investments Inc. (NYSEMKT:MGT), and Globalstar, Inc. (NYSEMKT:GSAT), opened up substantially higher before moving in separate directions. In this article, we find out why traders have been buying and take a look at how smart money investors have been trading them.
While there are many metrics that investors can assess in the investment process, the hedge fund sentiment is something that is often overlooked. However, hedge funds and other institutional investors allocate significant resources while making their bets and their long-term focus makes them the perfect investors to emulate. This is supported by our research, which determined that following the small-cap stocks that hedge funds are collectively bullish on can help a smaller investor to beat the S&P 500 by around 95 basis points per month (see the details here).
Analyst Weigh in on J C Penney Company After Earnings
J C Penney Company Inc (NYSE:JCP) shares opened up higher today after the analysts at Robert W. Baird upgraded the stock to ‘Outperform’ from ‘Neutral’. The analysts like J C Penney’s risk reward profile and think the stock could ultimately go to $12 a share. Meanwhile the analysts at Citigroup went the other way and lowered their price target to $8 per share from $9 per share. The analysts at Morgan Stanley were even more bearish, and lowered their price target by $0.50 to $7.50 per share. Although J C Penney Company Inc (NYSE:JCP) reported disappointing earnings on Friday, some investors believe the company can successfully turn itself around. A total of 27 funds that Insider Monkey tracks owned shares of J C Penney at the end of December.
Analysts Give the Thumbs Up to Freeport-McMoRan
Freeport-McMoRan Inc (NYSE:FCX) is trading 8% higher after analysts at Cowen raised their price target to $15 per share from $10 per share. The analysts maintained their ‘Outperform’ rating and believe the company’s strong collection of copper assets and cost cutting will provide meaningful upside. Also helping Freeport-McMoRan Inc (NYSE:FCX) shares today is the fact that WTI crude prices are 3% higher and near $48 per barrel. Carl Icahn’s Icahn Capital LP owned 104 million shares of Freeport at the end of 2015.
On the next page, we will examine the latest events that put LendingClub, MGT Capital Investments, and Globalstar in the spotlight today.