Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Why These Five Stocks Are Trending on Monday

Page 1 of 2

Markets are tumbling on Monday, with all major U.S. indexes, oil and gold trading slightly down. However, a few stocks are registering significant moves; among them we can count Smith & Wesson Holding Corp (NASDAQ:SWHC), Sturm, Ruger & Company (NYSE:RGR), Zafgen Inc (NASDAQ:ZFGN), Edwards Lifesciences Corp (NYSE:EW) and PulteGroup, Inc. (NYSE:PHM). So, let’s take a look into the events behind these big fluctuations, and into what the funds in our database think about the companies involved.

Our research 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).

Let’s start with Smith & Wesson Holding Corp (NASDAQ:SWHC), whose stock has dropped by 16% on Monday, after Cowen, CL King and BB&T Capital Markets downgraded the stock. The demotions were prompted by the release of National Instant Criminal Background Check System (NICS) data for March; while firearm background checks, which are an important indicator of gun purchases, were up by 16.7% year-over-year, they were down 13.2% month-over-month – marking the largest tumble in 10 years. Cowen seemed to be the first one to issue a downgrade to ‘Market Perform’ from ‘Outperform’. BB&T and CL King followed suit, trimming their scores to ‘Hold’ and ‘Neutral’, respectively, from ‘Buy’.

Follow American Outdoor Brands Corporaton (NASDAQ:AOBC)
Trade (NASDAQ:AOBC) Now!

Also down by near 10% on the NICS data are shares of Sturm, Ruger & Company (NYSE:RGR), as well as retailers that sell guns, Sportsman’s Warehouse Holdings Inc (NASDAQ:SPWH) and Cabelas Inc (NYSE:CAB), whose stocks slid by 3% and 0.8%, correspondingly.

Follow Sturm Ruger & Co Inc (NYSE:RGR)
Trade (NYSE:RGR) Now!

Among the hedge funds that we track, 27 were long Smith & Wesson Holding Corp (NASDAQ:SWHC) by the end of the fourth quarter, and 14 were long Sturm, Ruger & Company (NYSE:RGR). Among the most bullish firms was Jim Simons’ Renaissance Technologies; the fund last disclosed ownership of 872,076 shares of the former company, following a 68% increase in its stake, and ownership of 186,600 shares of the latter, following a 294% boost in its exposure.

Page 1 of 2