Crown Castle, Callidus Software: Why These 5 Stocks Are Capturing Investors’ Interest Today

The latest API inventory data is in, and U.S. inventories likely increased by 1.4 million barrels last week according to the firm’s data. Although inventories increased, the number is still better than the average estimate of a rise of 4 million barrels. Traders are now eagerly anticipating the EIA’s report for confirmation.

In this article, we’ll take a closer look at five stocks that traders are also eagerly monitoring and use the latest 13F data to see how hedge funds are positioned in them. Those stocks are Freeport-McMoRan Inc (NYSE:FCX), Crown Castle International Corp (NYSE:CCI), American Tower Corp (NYSE:AMT), American Electric Power Company Inc (NYSE:AEP), and Callidus Software Inc. (NASDAQ:CALD).

At Insider Monkey, we track around 750 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 the details here).

Freeport-McMoRan Inc (NYSE:FCX) is on many traders’ watchlist after somewhat mixed analyst/investor commentary concerning the company’s recent sale of its deepwater assets in the Gulf of Mexico for $2 billion. On one hand, the deal won the approval of Carl Icahn, whose Icahn Capital LP owned 104 million shares of Freeport-McMoRan Inc (NYSE:FCX) at the end of June. Icahn said the following about the deal:

“[the] announcement demonstrates the Company is making good on its stated goal of deleveraging and is on track to cut its net debt by half, from year end 2015 through the end of next year, at current copper prices.”

On the other hand, analysts at Deutsche Bank thought Freeport-McMoRan could have potentially gotten more for the assets, as they estimated that they could have been worth up to $2.9 billion. In conjunction with the statement, Deutsche Bank trimmed its price target on the company’s stock to $12 from $12.50.

Crown Castle International Corp (NYSE:CCI) and American Tower Corp (NYSE:AMT) are in the spotlight after analysts at SunTrust Robinson Humphrey initiated ‘Buy’ ratings on both stocks. The analysts are bullish due to the belief that wireless competition will increase capital spending in the industry, which could in turn translate into potentially faster-than-expected growth for both companies. In addition, the analysts noted a number of potential catalyst growth drivers such as 5G trails, FirstNet, and new spectrum deployments/re-farming that could accelerate growth for the sector as a whole. SunTrust has a $107 price target on Crown Castle and a $128 price target on American Tower. Shares of the companies currently change hands at $91.40 and $108.71 respectively.

Of the 749 hedge funds that we track which filed 13Fs for the June quarter, 44 owned shares of Crown Castle International Corp (NYSE:CCI) on June 30, while 49 had a long position in American Tower Corp (NYSE:AMT). The hedge funds in our system owned a little over 6% of each company’s float.

On the next page, we’ll examine why American Electric Power Company and Callidus Software are trending this morning.

Traders are buzzing about American Electric Power Company Inc (NYSE:AEP) after the Wall Street Journal published an article stating that the company is close to a deal to sell four power plants in the MidWest to ArcLight Capital and Blackstone Group for around $2.1 billion. The deal includes one coal-fired plant and three natural gas-powered plants in Ohio and Indiana. AEP is selling due to its strategy of pivoting away from wholesale power and toward regulated utilities. 27 funds that we track were long American Electric Power Company Inc (NYSE:AEP) at the end of the second quarter, down by five funds quarter-over-quarter.

Callidus Software Inc. (NASDAQ:CALD) is trending after it filed a Form 3-SASR which stated that the company is making a public offering of 4 million shares and granting underwriters a 30-day option to buy up to 600,000 additional shares. The company hopes to use the net proceeds of around $72 million-to-$83 million (if the underwriter option is exercised; the exact pricing of the offering is not certain and likely lower than $19.28 per share) for working capital and other general corporate purposes. The number of funds in our database with holdings in Callidus Software Inc. (NASDAQ:CALD) fell by four during the second quarter to 19 at the end of June.

Disclosure: None