With the U.S. Presidential debate on September 26 expected to draw a massive audience, many traders are eagerly anticipating the latest polling numbers to see what economic direction the U.S. will inch towards. If Clinton wins, the U.S. will likely remain pro-free trade, while if Trump wins, America will put itself first.
In this article, we’ll take a closer look at five stocks traders are watching today, which are Magna International Inc. (USA) (NYSE:MGA), Delphi Automotive PLC (NYSE:DLPH), Wells Fargo & Co (NYSE:WFC), Sarepta Therapeutics Inc (NASDAQ:SRPT), and United Parcel Service, Inc. (NYSE:UPS). In addition, we’ll use the latest 13F data to see how successful hedge funds are positioned in each stock.
We believe that imitating hedge funds and other large institutional investors can be helpful in identifying stocks capable of outperforming the broader market. Through extensive research that covered portfolios of several hundred large investors between 1999 and 2012, we determined that following the small-cap stocks that large money managers are collectively bullish on, can generate monthly returns nearly 1.0 percentage points above the market (see the details here).
Magna International Inc. (USA) (NYSE:MGA) and Delphi Automotive PLC (NYSE:DLPH) are each in the spotlight after Barron’s published a bullish column on both stocks, calling the two equities “cheap ways” to play the secular rise of autonomous cars. According to the article, both companies have expertise with autonomous tech. Delphi has worked on autonomous driving for over five decades and was the first to introduce the cruise-control system. Meanwhile, writer Tiernan Ray thinks that “Magna is what one might consider a Jabil of its industry, building many of the parts inside and out, the way Jabil helps assemble Apple’s iPhone.” Both stocks also trade for relatively low valuations, with Magna sporting a forward P/E of 7.07 and Delphi trading for just over 10-times forward earnings.
In terms of hedge fund ownership, both companies have some fans among the smart money crowd. Of the 749 top funds in our database that filed 13Fs for the June quarter, 29 were long Magna International Inc. (USA) (NYSE:MGA) on June 30, while 30 were long Delphi Automotive PLC (NYSE:DLPH).
On the next page, we’ll examine the latest on Wells Fargo, Sarepta Therapeutics, and United Parcel Service.