Why Chipotle, CarMax, Tesla, Wal-Mart, and More Are Trending

Wall Street is calm once again today, as all three major indexes have opened in the green. Helping sentiment was a largely bullish crude inventory report from the API yesterday.

In this article, we’ll take a closer look at Chipotle Mexican Grill, Inc. (NYSE:CMG), CarMax, Inc (NYSE:KMX), Wal-Mart Stores, Inc. (NYSE:WMT), Target Corporation (NYSE:TGT), and Tesla Motors Inc (NASDAQ:TSLA), five stocks that investors are buzzing about this morning, and use the latest regulatory filings to determine how the smart money has been trading each stock.

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Chipotle Mexican Grill, Inc. (NYSE:CMG) shares are slightly in the red on the back of some bearish Goldman Sachs commentary. Due to online search trends for the company’s Chiptopia event showing a noticeable dropoff for the month of August, Goldman analyst Karen Holthouse trimmed her fourth quarter comparable-store sales estimate to a 21.4% year-over-year decline, versus the previous estimate of an 18.4% decline. The analyst also lowered her target price on the stock to $395 per share from the previous mark of $445. Some smart money funds understandably disagree, as our records show that Bill Ackman‘s Pershing Square owns around 9.9% of Chipotle Mexican Grill, Inc. (NYSE:CMG)’s shares.

CarMax, Inc (NYSE:KMX) is off by over 4% today after the company reported disappointing fiscal year 2017 second quarter results. For the period, CarMax earned $0.84 per share, versus estimates of $0.88. Although the company’s sales rose by 3.1% year-over-year to $4 billion, CarMax’s top-line still missed the consensus target by $90 million. One reason for the soft performance was the average selling price for used vehicles for the period, which inched lower by 2.3% to $19,530. Meanwhile, the average selling price of a wholesale vehicle also fell by 4.1%. In terms of guidance, CarMax’s management expects to open 15 new stores and to spend around $450 million in capex for its 2017 fiscal year. Of the 749 hedge funds that we track which filed 13Fs for the June quarter, 21 funds were long $951.66 million worth of CarMax, Inc (NYSE:KMX) shares on June 30, which accounted for 10.00% of the float.

On the next page, we’ll examine why Wal-Mart, Target, and Tesla are in the spotlight today.

Wal-Mart Stores, Inc. (NYSE:WMT) is in the spotlight after the retailing giant disclosed that it awarded over $200 million in cash bonuses to its hourly associates in the second quarter. To put that in perspective, the amount paid translates to around $222 per hourly associate. Although that doesn’t sound like much, it is still an award of over 22 hours of pay for workers who make $10 per hour. Given that Wal-Mart has been criticized in the past for not paying its workers a living wage, the second quarter bonuses will help improve Wal-Mart’s image among those who are in support of a living wage. According to our data, 58 funds that we track were long Wal-Mart Stores, Inc. (NYSE:WMT) at the end of June, up by four quarter-over-quarter.

Target Corporation (NYSE:TGT) shares are 1% in the green after the retailer announced that its Board of Directors has authorized a new $5 billion share repurchase program. The retailer will begin buying back shares under the new authorization once the company completes the buybacks under its current $10 billion repurchase program, which its management expects will occur before the end of its fiscal year 2016. The number of funds in our system with holdings in Target Corporation (NYSE:TGT) stood at 32 at the end of June, down by two quarter-over-quarter.

Traders are talking about Tesla Motors Inc (NASDAQ:TSLA) today after the company issued a software update to fix bugs that could have potentially allowed very skilled hackers to break into the Model S’ control system and disrupt various actions relating to its displays, turn signals, and other systems. A Tesla spokesperson said: “Our realistic estimate is that the risk to our customers was very low. But this did not stop us from responding quickly.” Patching bugs will be even more important in the future as cars become more automated and connected. 36 funds tracked by Insider Monkey owned shares of Tesla Motors Inc (NASDAQ:TSLA) at the end of the second quarter, accounting for 4% of the float at that time.

Disclosure: None