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Why Facebook, Opower, Genworth, Apollo Education, and Sarepta Are Spiking Today

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Even though oil is down on Monday, U.S stocks are up, partly driven by strength in the financial and consumer discretionary sectors. In this article we will take a look at five individual stocks that are on the rise today: Opower Inc (NYSE:OPWR), Genworth Financial Inc (NYSE:GNW), Sarepta Therapeutics Inc (NASDAQ:SRPT), Apollo Education Group Inc (NASDAQ:APOL), and Facebook Inc (NASDAQ:FB). What is behind the spikes in these stocks? And what do the hedge funds in our database think about these companies and their long-term prospects? Let’s find out.

Our research has shown that the best strategy is to follow hedge funds into their small-cap picks. This approach can allow monthly returns of nearly 95 basis points above the market, as we determined through extensive backtests covering the period between 1999 and 2012 (see the details here).

Opower Surges on Ameliorated Acquisition Offer

Let’s start with Opower Inc (NYSE:OPWR), which is up by more than 30% in Monday trading on the news that Oracle Corporation (NYSE:ORCL) has agreed to acquire the small-cap customer engagement and energy efficiency cloud services provider for roughly $532 million, or $10.30 per share in cash. The offer implied a 30% premium to the stock’s closing price on Friday and shares have quickly surged to fill in the gap, with investors seemingly unconcerned that any issues will prevent it from being completed.

As of the end of the fourth quarter of 2015, Opower Inc (NYSE:OPWR) counted 11 hedge fund supporters among those that we track. Their combined stakes accounted for more than 8% of the company’s shares.

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Genworth Continues to Rise on Earnings

Another big gainer on Monday afternoon is Genworth Financial Inc (NYSE:GNW), which has risen by almost 19% today, a strong continuation of a rally that started on Friday, when it gained 20.35%. That spike was triggered by the announcement of the company’s first quarter financial results after the market closed on Thursday, when the company reported adjusted EPS of $0.21 per share for the quarter, $0.07 above the Street’s consensus. And though revenue of $1.785 billion fell well short of expectations of $2.175 billion, investors seemed satisfied with the operating profit and the fact that CEO Tom McInerney is working to free up capital to meet the company’s debt payments.

28 funds among those that we track were long Genworth Financial Inc (NYSE:GNW) at the end of 2015. Quite recently, Himanshu H. Shah’s Shah Capital Management reported ownership of 4.69 million shares of the company as of March 31, boosting its exposure to the stock by 50% during the first quarter.

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We’ll cover the other three big gainers referenced in the opening paragraph on the next page.

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