While Wall Street began its descent on the performance chart on opening bell and slightly recovered in the first hours of trading, Monster Beverage Corporation (NASDAQ:MNST), Tableau Software Inc (NYSE:DATA), Qorvo Inc (NASDAQ:QRVO) and Take-Two Interactive Software, Inc. (NASDAQ:TTWO) rode on gains on Friday. Let’s take a closer look at the developments that stand behind their growth and see if the sentiment among the funds we track complies with today’s trends.
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Why do we pay attention to hedge fund sentiment. Most investors ignore hedge funds’ moves because as a group their average net returns trailed the market since 2008 by a large margin. Unfortunately, most investors don’t realize that hedge funds are hedged and they also charge an arm and a leg, so they are likely to underperform the market in a bull market. We ignore their short positions and by imitating hedge funds’ stock picks independently, we don’t have to pay them a dime. Our research have shown that hedge funds’ long stock picks generate strong risk adjusted returns. For instance the 15 most popular small-cap stocks outperformed the S&P 500 Index by an average of 95 basis points per month in our back-tests spanning the 1999-2012 period. We have been tracking the performance of these stocks in real-time since the end of August 2012. After all, things change and we need to verify that back-test results aren’t just a statistical fluke. We weren’t proven wrong. These 15 stocks managed to return more than 102% over the last 37 months and outperformed the S&P 500 Index by 53 percentage points (see the details here).
Monster Beverage Corporation (NASDAQ:MNST) booked a 43.6% net income growth at $174.6 million, or 84 cents per share, compared to $121.6 million, or $0.73 per share in the third quarter of 2014. The California-based company reported $756.6 million in net sales for the third quarter of 2015, reflecting a 19.0% increase from the $636.0 million reported in the third quarter of 2014. Operating income also jumped to $291.4 million in the most current quarter, from the $190.0 million which was reported in the prior-year period. During the company’s earnings conference call, Monster Beverage Corporation (NASDAQ:MNST) said it partnered with the Coca-Cola Hellenic Group, which will be applied across 28 countries serviced by them for The Coca-Cola Co (NYSE:KO). In the deal, Monster plans to transition its brand from existing distributors in Italy, Romania, Ukraine, Bosnia, Croatia, Serbia and Slovenia to Hellenic. Moreover, Monster will expand its footprint in Russia through Hellenic before the year ends. Monster soared by more than 14% in active trading. Among the funds we track, a total of 27 held around 3% of the company’s outstanding stock at the end of June. Moreover, Clifford Fox’s Columbus Circle Investors reported ownership of 145,624 shares of Monster Beverage as of the end of September.
Tableau Software Inc (NYSE:DATA) celebrated its third quarter this year with over 3,100 new accounts, which brings the total client accounts to more than 35,000 worldwide. Tableau shares jumped 24% in brisk trading. During the quarter, the company also executed new partnerships, an expansion in China as well as an improved platform, Tableau 9.1, which gives users more flexibility. Tableau Software Inc (NYSE:DATA) reported non-GAAP operating income of $18.4 million for the third quarter of 2015, which significantly grew from the $8.7 million a year earlier. Meanwhile, total revenues for the third quarter of 2015, reached $170.8 million, up from the $104.5 million which was reported in the prior-year period. However, the company widened its net loss to $13.4 million, or $0.15, compared to the $4.6 million net loss, or $0.07, which was reported in the prior-year period. At the end of June, 38 funds from our database held nearly 17% of Tableau’s outstanding stock.
Qorvo Inc (NASDAQ:QRVO) has seen a positive leap on the board after yesterday it reported its fiscal 2016 second quarter net income of $4.4 million, or 3 cents, compared to $2.0 million, or 1 cent from the prior-year period. Qorvo, a provider of core technologies and RF solutions for mobile, infrastructure and aerospace/defense applications, opened the markets at $50.60. The company also announced that it intends to offer $1 billion of senior notes in a private offering. The proposed notes, the company said, are due 2023 and 2035, and will be senior unsecured obligations of Qorvo, according to a Form 8-K filed November 6. Qorvo Inc (NASDAQ:QRVO) expects to use the net proceeds of the offering for general corporate purposes, including share repurchases and repayment of any amounts outstanding under its revolving credit facility. During the second quarter, the number of funds bullish on Qorvo went up by five to 34 and they held 8.20% of the company at the end of June.
Take-Two Interactive Software, Inc. (NASDAQ:TTWO) rose 7.78% to $35.62, after beating expectations for its second fiscal quarter ended September 30. The company reported non-GAAP net income of $32.7 million, or $0.30 per share, compared to a non-GAAP net loss of $35.4 million, or $0.44, for the year-ago period.
“Our second quarter results were anchored by the series record-breaking launch of NBA 2K16, along with ongoing demand for Grand Theft Auto V and strong growth in recurrent consumer spending,” Take-Two Chairman and CEO Strauss Zelnick said.
Additionally, Take-Two Interactive Software, Inc. (NASDAQ:TTWO) released an initial financial outlook for its fiscal third quarter ending December 31, with a non-GAAP net income of $0.40 to $0.50 per share, as well as a non-GAAP net revenue of $400 million to $450 million. In Take-Two, 40 funds from our database reported stakes as of the end of June, up from 34 a quarter earlier. These funds held over 37% of the company at the end of the second quarter.
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