Seeing as all three indexes have surged more than 1% in morning trading as the Federal Reserve promises interest rates will still be low for a while, shares of Inland Real Estate Corporation (NYSE:IRC), Sirius XM Holdings Inc. (NASDAQ:SIRI), Valeant Pharmaceuticals Intl Inc (NYSE:VRX), Pacira Pharmaceuticals Inc (NASDAQ:PCRX), and Intercept Pharmaceuticals Inc (NASDAQ:ICPT) are rallying above the market. In this article, we take a closer look at why investors are buying.
Given that Insider Monkey has done a lot of research into what the smart money likes and doesn’t like, let’s also analyze relevant hedge fund sentiment toward these stocks. In the eyes of most traders, hedge funds are assumed to be underperforming, old investment tools of the past. While there are more than 8000 funds in operation at present, Hedge fund experts at Insider Monkey look at the aristocrats of this group, around 730 funds. Contrary to popular belief Insider Monkey’s research revealed that hedge funds underperformed in recent years because of their short positions as well as the huge fees that they charge. Hedge funds managed to outperform the market on the long side of their portfolio. In fact, the 15 most popular small-cap stocks among hedge funds returned 102% since the end of August 2012 and beat the S&P 500 Index by 53 percentage points (see the details here).
Inland Real Estate Corporation (NYSE:IRC), which owns and operates shopping centers in strong geographic markets, is 6.09% higher today after the company announced it will sell itself to DRA Advisors for $10.60 in cash per share in a deal that should close in the first half of 2016. Chairman Thomas P. D’Arcy said in a statement:
“The Board has been focused on the options available to address the long-term discount at which the Company’s shares have traded versus private market valuations and its shopping center REIT peers. The Board unanimously believes this all-cash offer is the best course of action to address this valuation gap and provide our stockholders with strong relative value for their investment.”
A total of 10 funds from our database were among today’s winners as they were long roughly 4.3% of Inland Real Estate Corporation (NYSE:IRC)’s float as of September 30.
Moving on, Sirius XM Holdings Inc. (NASDAQ:SIRI) shares have surged by 3.13% after the company announced it has resigned radio personality Howard Stern to a new 5-year contract. Although financial terms of the deal haven’t been disclosed, Stern is making $80 million a year from his previous contract. Shares of the satellite radio broadcaster have rallied more than 17% year-to-date on the back of solid earnings results. There could be more upside ahead, as the smart money is optimistic on the company, with the number of elite funds long Sirius XM Holdings Inc. (NASDAQ:SIRI) increasing by three to 35 during the third quarter.
On the next page, we examine the reasons behind the gains registered by the three pharmaceutical stocks.