Although domestic durable goods orders rose 4.8% for the month of October versus a 0.4% rise in September, the broader markets are slightly in the red today as many traders prepare for the upcoming Thanksgiving holiday. In this article, let’s find out why traders are talking about Alphabet Inc (NASDAQ:GOOG), Facebook Inc (NASDAQ:FB), Twitter Inc (NYSE:TWTR), Enable Midstream Partners LP (NYSE:ENBL), and Diplomat Pharmacy Inc (NYSE:DPLO) and let’s analyze hedge fund sentiment towards the stocks using 13F filings.
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).
Alphabet Inc (NASDAQ:GOOG) is in the spotlight after Reuters reported that the internet conglomerate is close to a tax settlement with Indonesia’s government concerning the last five years. After initially facing the prospect of a bill of over $400 million in fines and back taxes for 2015 (if it were found culpable), the news agency reports that a settlement could occur within the next few weeks and could resolve Google’s back tax and fines in the country for presumably a smaller amount. Although it removes uncertainty, some analysts fear that the settlement could cause more countries to ask for more in taxes from the company as well. Natixis Global Asset Management‘s Harris Associates owned 2.3 million shares of Alphabet Inc (NASDAQ:GOOG) Class C shares at the end of September, up 9% from the end of June.
Traders are keeping a close eye on Facebook Inc (NASDAQ:FB) after news broke that the company has been working on an experimental internal tool to suppress certain posts in certain regions. Although Facebook has not rolled the tool out, traders believe the social network is developing the software in hopes of gaining access to the crucial China market, where the government censors some content. If Facebook can gain access to China, the company’s growth prospects would benefit. Of the 742 funds in our database, the number of funds with stakes in Facebook Inc (NASDAQ:FB) inched up by one sequentially to 149 at the end of the third quarter.
On the next page, we examine Twitter, Enable Midstream Partners LP, and Diplomat Pharmacy.