Why GoPro, Microsoft, Twitter and Two Other Stocks Are in Spotlight Today

Markets were tumbling on Monday, with all major U.S. stock indexes down substantially, driven by a selloff in tech stocks and a decline in oil prices. However, a few stocks managed to salvage themselves, trading up in the afternoon hours. Among them, we can count GoPro Inc (NASDAQ:GPRO), Gilead Sciences, Inc. (NASDAQ:GILD) and Celgene Corporation (NASDAQ:CELG). So, let’s take a look into the events causing said surges, and into what the hedge funds in our database think about the companies. In addition, we will examine the reasons behind the declines seen at Twitter Inc (NYSE:TWTR) and Microsoft Corporation (NASDAQ:MSFT) today.

We determine hedge fund sentiment by analyzing the equity portfolios of some of the best-performing hedge funds and institutional investors. Through extensive research, we have determined that the due diligence that these investors employ, as well as their long-term focus makes them perfect targets to emulate. However, the results of our analysis have also showed that the small-cap picks of these funds can generate much better returns, with the 15 most popular small-cap stocks beating the market by an average of 95 basis points per month (read more details here).

Back to the stocks that interest us, we’ve got GoPro Inc (NASDAQ:GPRO), whose shares are up more than 10% after Microsoft Corporation (NASDAQ:MSFT) announced on Friday that it had signed a patent licensing deal with the manufacturer of wearable cameras. Terms of the deal were not disclosed, but Microsoft said in a statement, that the deal is related to “certain file storage and other system technologies.”

Nick Psyhogeos, President of Microsoft Technology Licensing LLC said that the company’s “licensing of personal wearable technologies is seeing strong demand” as the firm partners “with companies from all industries to optimize solutions for their customers around the globe.”

On the other hand, shares of Microsoft Corporation (NASDAQ:MSFT) are trading down by more than 2.5% on Monday.

Also helping GoPro Inc (NASDAQ:GPRO) was a Barron’s article published over the weekend, which assured that the company still has “some financial cushion to regain its footing,” taking into account its $474 million in cash and no debt. The author also noted that the current valuation of GoPro’s stock makes it an attractive acquisition target for companies like Sony Corp (ADR) (NYSE:SNE) or Under Armour Inc (NYSE:UA).

On the next page we will look into the news driving the moves at Twitter Inc (NYSE:TWTR), Gilead Sciences, Inc. (NASDAQ:GILD) and Celgene Corporation (NASDAQ:CELG), and into hedge fund sentiment of these stocks.

Twitter Inc (NYSE:TWTR) was down about by 2.75% in the early afternoon, following reports about a possible change in the social network’s timeline some time this week. The new timeline would be of al algorithmic nature, reports suggested. This means that, instead of getting tweets in a reverse chronological order, users would get the ones that Twitter believes he/she is more interested in, first. Although this could prove interesting, people were worried that the change would lead less popular accounts into oblivion, and expressed their disconformity using the #RIPTwitter hashtag.

It seems like some hedge funds saw the tough times coming, and decided to leave Twitter Inc (NYSE:TWTR) before it was too late. During the third quarter of 2015, Daniel Benton’s Andor Capital Management, one the largest hedge fund investor of record sold all of its 1.5 million shares of the social media giant, same as Cliff Asness’ AQR Capital Management, which disposed of 814,578 shares over the period, closing out its stake in the firm.

Back to gainers, we’ve got Gilead Sciences, Inc. (NASDAQ:GILD) and Celgene Corporation (NASDAQ:CELG) both slightly up on Monday afternoon following a Barron’s article that assured that both these stocks can offer a 30% upside.

“Concentrated drug portfolios may be a concern, but low valuations and strong free cash flow give them appeal,” author Jack Hough explained. The recent plummet in biotech stocks has opened an attractive entry point at some companies “that are already highly profitable and were inexpensive before the selling began.” Celgene and Gilead could be included in this group, and could be trading 30% higher over the next 12 months, he added.

Opposite to what happened with Twitter, AQR Capital Management seems quite bullish on both Celgene Corporation (NASDAQ:CELG) and Gilead Sciences, Inc. (NASDAQ:GILD). As of the end of the third quarter of 2015, the fund disclosed ownership of more than 4.76 million shares of Gilead, worth over $468 million, and 1.53 million shares of Celgene, valued at roughly $166 million.

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.