Wall Street has rebounded today amid the European Central Bank’s expected decision on its monetary stimulus program and oil prices climbing after reaching their lowest close in more than a decade. Among the gainers today are Micron Technology, Inc. (NASDAQ:MU), Advanced Micro Devices, Inc. (NASDAQ:AMD), Pearson PLC (ADR) (NYSE:PSO), FARO Technologies, Inc. (NASDAQ:FARO), and Twitter Inc (NYSE:TWTR) as investors buy each stock for various reasons. Let’s find out why these particular stocks are making waves and assess the hedge fund sentiment towards these stocks.
While there are many metrics that investors can assess in the investment process, hedge fund sentiment is something that is often overlooked. However, hedge funds and other institutional investors allocate significant resources while making their bets and their long-term focus makes them the perfect investors to emulate. This is supported by our research, which determined that following the small-cap stocks that hedge funds are collectively bullish on can help a smaller investor beat the S&P 500 by around 95 basis points per month (see more details here).
The first on the list is Micron Technology, Inc. (NASDAQ:MU), whose shares are nearly 6.5% higher today after Morgan Stanley (NYSE:MS)’s Joseph Moore maintained an ‘Overweight’ rating with a price target of $18 on the stock, giving it almost 70% upside potential. Although the analyst thinks that the company’s fundamentals will be a matter of concern in the first half of the year, he also thinks that they could improve in the second half. Recently, analysts at Mizuho cut their price target to $12 per share from $15 per share, while analysts at Sanford C. Bernstein trimmed their target price on the stock to $14 from $20. However, several analysts have reiterated bullish ratings on Micron Technology, Inc. (NASDAQ:MU), including Deutsche Bank and Cowen and Company, which have reaffirmed ‘Buy’ ratings this year.
Among the funds we follow, 71 reported long positions in Micron Technology, Inc. (NASDAQ:MU) as of the end of September, down by eight funds from a quarter earlier. Sander Gerber‘s Hudson Bay Capital Management reported holding a $57.14 million position in the stock as of that time, comprising 2.5% of its 13F portfolio.
Moving on, Advanced Micro Devices, Inc. (NASDAQ:AMD) shares are up by 13% today with seemingly no notable news pushing the gains. Two days ago, the company reported mixed fourth quarter results. For the quarter ended December 31, Advanced Micro Devices reported revenue of $958 million, down by 22.7% year-over-year, but beating expectations of $955 million, while its loss per share came in at $0.10 per share, in-line with analysts’ expectations. Moreover, while the semiconductor company’s guidance for the first quarter was better than the Street’s consensus, it would still represent a 14% quarter-over-quarter decline.
Advanced Micro Devices, Inc. (NASDAQ:AMD) lost popularity in the third quarter of 2015, as out of the 730 funds that we track, 11 funds held shares of the company on September 30, amassing just 0.5% of the float, down from 15 funds on June 30. Cliff Asness‘ AQR Capital Management was the largest shareholder of Advanced Micro Devices in our system, with 1.7 million shares valued at $2.92 million at the end of September.