Why Traders Are Watching BHP, Applied Materials, Red Hat and Two Other Stocks on Thursday

U.S. and global stock markets are up substantially on Thursday, ahead of the Brexit vote, as polls suggest the “remain” choice will most likely prevail.

Among individual stocks, BHP Billiton Limited (ADR) (NYSE:BHP), Whiting Petroleum Corp (NYSE:WLL), Applied Materials, Inc. (NASDAQ:AMAT), Amazon.com, Inc. (NASDAQ:AMZN), and Red Hat Inc (NYSE:RHT) are trending today. So, let’s take a look into the events behind the moves of these stocks, and see what the funds in our database think about the companies in question.

At Insider Monkey, we track around 770 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see more details about our small-cap strategy).

BHP Billiton Spiking Along Materials Stocks

Let’s start with BHP Billiton Limited (ADR) (NYSE:BHP), which has gained more than 4.1%, amid a Reuters report that the Australian miner “pulled a $500 million debt refinancing plan at one of Australia’s biggest coal export terminals after banks were reluctant to lend to the sector.” So, why is the stock rising despite the bad news? Well, it seems like the spike is part of a larger uptrend seen in mining and basic materials stocks in general today. As of the end of the first quarter of 2016, 12 funds among those we track are long BHP Billiton Limited (ADR) (NYSE:BHP), up bz 20% quarter-over-quarter. Among them, we could highlight Dmitry Balyasny’s Balyasny Asset Management, which almost quadrupled its stake over the quarter to 1.9 million shares.

Whiting Slips On Note-Exchange Agreements

On the other hand, shares of Whiting Petroleum Corp (NYSE:WLL) are trading down by almost 9% even though oil is on the rise. It seems what is driving the tumble is the announcement of new privately negotiated exchange agreements, under which the company will trade $377 million in nonconvertible notes for the same amount of new mandatory convertible notes. In addition, the firm will swap $687.9 million in convertible notes for the same amount of new mandatory convertible notes. A total of 43 funds among those we track held long positions in Whiting Petroleum Corp (NYSE:WLL) at the end of March. The largest stakes were reported by  Debra Fine’s Fine Capital Partners, which more than quadrupled its exposure over the quarter to 9.69 million shares, and John Paulson’s Paulson & Co with 3.16 million shares.

On the next page we will take a look into three other stocks posting important moves on Thursday trading.

Nomura Gives Applied Materials A Boost

Shares of Applied Materials, Inc. (NASDAQ:AMAT) have inched up by roughly 1.8% on Thursday, helped by a price target hike at Nomura. After attending a meeting with the company’s CFO and display chief, Nomura’s Romit Shah reiterated a Buy rating on the stock, while boosting his price target from $25 to $28. Applied Materials, Inc. (NASDAQ:AMAT) saw the number of investors in our database long its stock drop by two to 39, over the first quarter. Among those that remained bullish were Harris Associates, with 39 million shares, and D. E. Shaw, which disclosed ownership of 8.83 million shares as of March 31.

Amazon Gains On Upgrade, FedRAMP Authorization

Also on the rise on Thursday is Amazon.com, Inc. (NASDAQ:AMZN), which has advanced almost 1.2% today after Maxim Group initiated coverage on the stock with a ‘Buy’ rating and $825 price target. In other news, the company was fined $130,000 by the FAA on allegations that the eCommerce giant “mishandled” shipments of dangerous chemicals. A total of 133 funds tracked by Insider Monkey held shares of Amazon.com, Inc. (NASDAQ:AMZN) at the end of the first quarter, down from 141 in the previous quarter.

Red Hat’s Earnings Call Disappoints Investors

Finally, there’s Red Hat Inc (NYSE:RHT), whose stock has tumbled 2.7% on Thursday, following the announcement of the company’s first quarter financial results on Wednesday afternoon. While sales of $567.9 million (up by 18.1% year-over-year) beat the Street’s consensus by $5.14 million, EPS of $0.50 were in-line with estimates. In addition, the company’s management said that the company would repurchase up to $1 billion of its common stock – instead of the originally planned $500 million, and that it had agreed to acquire 3scale, a leading application programming interface (API) management technology provider. At the end of March, 39 funds tracked by us were long Red Hat Inc (NYSE:RHT) nd held 5% of its float at the end of March. The largest position was held by Ken Griffin’s Citadel Investment Group, which owned 1.02 million shares of the company, after increasing its exposure by 11% over the quarter.

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