Although the U.S. dollar remains strong, the stocks of emerging markets have performed well recently as investors become more bullish on global growth prospects. Given the strength of the emerging markets, it’s not surprising that the S&P 500 and the NASDAQ futures are each in the green in the pre-market.
In this column, let’s take a closer look at the events causing five stocks, Macquarie Infrastructure Corp (NYSE:MIC), PPG Industries, Inc. (NYSE:PPG), General Electric Company (NYSE:GE), Intercontinental Exchange Inc (NYSE:ICE), and PepsiCo, Inc. (NYSE:PEP), to trend. Let’s also use the latest 13F data to determine smart money sentiment toward the equities.
At Insider Monkey, we’ve developed an investment strategy that has delivered market-beating returns over the past 12 months. Our strategy identifies the 100 best-performing funds of the previous quarter from among the collection of 700+ successful funds that we track in our database, which we accomplish using our returns methodology. We then study the portfolios of those 100 funds using the latest 13F data to uncover the 30 most popular mid-cap stocks (market caps of between $1 billion and $10 billion) among them to hold until the next filing period. This strategy delivered 39.7% gains over the past 12 months and outperformed the 24.1% gain enjoyed by the S&P 500 ETFs. Our enhanced small-cap hedge fund strategy returned more than 45% over the last 12 months and outperformed SPY by more than 30 percentage points over the last 4.5 years (see details here).
Macquarie Infrastructure Corp (NYSE:MIC) is trending after Tristan Richardson of SunTrust gave the company the thumbs up, setting a $96 price target and initiating a ‘Buy’ rating. Richardson’s recommendation is in stark contrast to Hedgeye’s opinion in late January, where the ratings firm named Macquarie Infrastructure as one of its short ideas. Of the 742 elite funds we track, 42 funds owned $905.34 million of Macquarie Infrastructure Corp (NYSE:MIC) and accounted for 13.50% of the float on December 31, versus 45 funds and $1.06 billion respectively on September 30.
Traders are watching PPG Industries, Inc. (NYSE:PPG) after Bloomberg reported that the company is said to be ‘preparing a renewed takeover bid’ for Europe’s largest coatings maker, Akzo Nobel NV. Akzo previously rejected PPG’s earlier offer of around $22.4 billion earlier this month, saying that PPG’s offer undervalued it. Bulls hope that PPG can realize enough synergies from any Akzo deal to make the merger worthwhile. 32 elite funds were long PPG Industries, Inc. (NYSE:PPG) at the end of December, down 2 funds from the previous quarter.
General Electric Company (NYSE:GE) is on watch after the Handelsblatt reported that the conglomerate plans on investing half a billion dollars in GE Healthcare over the next three years. The money will go to beefing up the segment’s digital operations and potentially for acquiring outside data analysis firms. Given that IT can increase efficiency markedly, bulls hope that GE’s investment will more than pay for itself and increase margins in the long run. The number of elite funds with holdings in General Electric Company (NYSE:GE) fell by 1 quarter-over-quarter to 54 at the end of December.
On the next page, we examine why the spotlight is shining on Intercontinental Exchange Inc, and PepsiCo Inc.