Although the earnings reports of various tech companies have mostly commanded the spotlight this Tuesday, the shares of five companies, Visa Inc (NYSE:V), Johnson & Johnson (NYSE:JNJ), Pfizer Inc. (NYSE:PFE), Depomed Inc (NASDAQ:DEPO), and Corrections Corp Of America (NYSE:CXW) are also trending for various reasons.
Let’s take a closer look at why each traders are closely watching the five stocks and see how elite funds are positioned among them.
Through extensive research, we determined that imitating some of the picks of hedge funds and other institutional investors can help generate market-beating returns over the long run. The key is to focus on the small-cap picks of these investors, since they are usually less followed by the broader market and are less price-efficient. Our backtests that covered the period between 1999 and 2012, showed that following the 15 most popular small-caps among hedge funds can help a retail investor beat the market by an average of 95 basis points per month (see the details here).
Visa Inc (NYSE:V) is in the spotlight after the company announced that its CEO, Charlie Scharf, will resign come December 1, 2016. Scharf intends to resign because he he could no longer spend the time in San Francisco necessary to do his job at Visa Inc (NYSE:V) effectively. Taking Scharf’s place is Alfred Kelly, who is currently a board member and the CEO of Intersection Co. Ken Fisher’s Fisher Asset Management inched lower its stake in Visa Inc (NYSE:V) by 1% to 14.76 million shares during the third quarter.
Johnson & Johnson (NYSE:JNJ) earned $1.68 per share in its third quarter, beating the Street’s expectations by $0.03. Revenue of $17.82 billion also topped the estimates by $110 million and advanced by 4.2% year-over-year. Among the lights-out performers in the quarter was Stelara, whose sales jumped by 32.8% on the year, and the company’s Immunology segment, which saw sales rise by 18% year-over-year. For the full 2016, Johnson & Johnson expects adjusted EPS of $6.68 to $6.73, up from the previous range of $6.63-$6.73. Revenues are expected between $71.5 billion and $72.2 billion. Of the 749 funds that we track, 82 funds were long Johnson & Johnson (NYSE:JNJ) at the end of June.
Another healthcare giant and dividend favorite, Pfizer Inc. (NYSE:PFE) is trending after it announced the U.S. availability of a biosimilar of REMICADE, INFLECTRA. The launch of INFLECTRA is meaningful even for a company Pfizer’s size because Johnson and Johnson’s REMICADE registered $1.78 billion in sales in the third quarter alone. According to Pfizer, the company will sell INFLECTRA at an initial 15% discount to the wholesaler acquisition cost of REMICADE, so there is plenty of margin to be garnered. A total of 94 funds from our database owned shares of Pfizer Inc. (NYSE:PFE) at the end of the second quarter.
On the next page, we will examine Depomed, and Corrections Corp Of America.