Why These Five Stocks Are in Spotlight

All three major US indices closed higher yesterday as traders have been worrying less about the Brexit and focus on more positive macro-economic data instead.

Among the stocks that have been in the spotlight in the last couple of days are Galena Biopharma Inc (NASDAQ:GALE), General Mills, Inc. (NYSE:GIS), Monsanto Company (NYSE:MON), Wal-Mart Stores, Inc. (NYSE:WMT), and JD.Com Inc (ADR) (NASDAQ:JD). Let’s take a closer look at the events that put these stocks in the spotlight and the hedge fund sentiment towards them.

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Galena Drops on Study Discontinuation

Galena Biopharma Inc (NASDAQ:GALE) shares closed over 80% lower yesterday and are losing ground in the pre-market on Thursday after the company discontinued its Phase 3 PRESENT clinical trial assessing NeuVax for the potential prevention of the recurrence of early stage, node-positive breast cancer with low to intermediate HER2 Expression on the recommendation of an independent data monitoring committee. The committee recommended the discontinuation ‘due to futility’ or lack of efficacy. Five funds from our database owned $2.59 million worth of Galena Biopharma Inc (NASDAQ:GALE)’s stock, which accounted for 1.10% of the float on March 31, versus four funds and $2.51 million, respectively, a quarter earlier.

General Mills Reports Earnings

General Mills, Inc. (NYSE:GIS) has reported better-than-expected results for its fiscal fourth quarter, with EPS of $0.66 on revenue of $3.93 billion, beating the consensus by $0.06 per share and $70 million respectively. Although sales dropped 8.6% year-over-year, net revenue fell only 1% in terms of constant currency. Guidance isn’t bad, with management expecting fiscal year 2017 organic net sales to be flat to down 2%, and for FY 2017 adjusted EPS to rise by 6% to 8% on a constant currency basis. Among the funds we track, 25 funds were long General Mills, Inc. (NYSE:GIS) at the end of the first quarter, down by one from the previous quarter.

On the next page, we examine Monsanto Company, Wal-Mart Stores, and JD.Com Inc (ADR).

Monsanto Earnings Miss the Mark

Monsanto Company (NYSE:MON) reported earnings of $2.17 per share on revenue of $4.19 billion, missing estimates by $0.23 per share and $300 million, respectively, for its fiscal third quarter. For fiscal year 2016, management expects as-reported EPS of $3.36 to $4.14 per share. Although Monsanto’s results missed the mark, the stock still gained over 2% in the intraday trading on Wednesday. The results could be strong enough to justify a higher bid from Bayer or they could be construed as making Bayer’s previous offer adequate. The number of funds from our database with holdings in Monsanto Company (NYSE:MON) rose by 13 quarter-over-quarter to 51 at the end of March.

Wall Street Journal Article Shines Spotlight on Wal-Mart, JD.com

Wal-Mart Stores, Inc. (NYSE:WMT) and JD.Com Inc (ADR) (NASDAQ:JD) are in the spotlight after the Wall Street Journal published an article providing more details on the companies’ recent deal to swap Wal-Mart’s Yihaodian online platform for a 5% stake in JD.com. According to the article, Wal-Mart would garner ‘observer status’ at the Chinese e-commerce company’s board meetings if Wal-Mart increased its stake to 10% or higher. The retailing giant can increase its stake by buying on the open market or by purchasing shares from existing shareholders. On the surface, a deeper alliance between the two companies makes sense. Wal-Mart has struggled to achieve traction in the Chinese e-commerce market, while JD.com could use a deep-pocketed partner in its battle against Alibaba Group Holding Ltd (NYSE:BABA). A total of 54 funds tracked by us had a bullish position in Wal-Mart Stores, Inc. (NYSE:WMT) at the end of the first quarter, up by five funds from the previous quarter. Meanwhile, 73 funds owned shares of JD.Com Inc (ADR) (NASDAQ:JD) at the end of the first quarter, down by five from the end of the fourth quarter.

Disclosure: none