It’s another calm day on Wall Street as the Dow Jones index is up by just 6 points and the S&P 500 is 0.08% in the red. Among the stocks that traders are talking about for various reasons today are Royal Caribbean Cruises Ltd (NYSE:RCL), Norwegian Cruise Line Holdings Ltd (NASDAQ:NCLH), Exxon Mobil Corporation (NYSE:XOM), Chevron Corporation (NYSE:CVX), and Abeona Therapeutics Inc (NASDAQ:ABEO).
In this article, we will examine why each stock is in the spotlight and we will analyze the relevant hedge fund sentiment toward the stocks.
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).
Royal Caribbean Cruises Ltd (NYSE:RCL) and Norwegian Cruise Line Holdings Ltd (NASDAQ:NCLH) are in the red by around 2% and 5%, respectively, after JPMorgan analyst Joseph Greff downgraded both stocks to ‘Neutral’ from ‘Overweight’. After doing extensive research on sector fundamentals such as GDP growth, spending trends, and capacity changes, Greff came to the conclusion that there will not be a ‘meaningful fundamental turn in net yields/pricing’ in the sector and that the two cruise operators’ earnings could come in below the Street’s expectations. As for Royal Caribbean specifically, Greff thinks the eroding net yields of the company’s China segment as well as the ongoing weakness in Europe will likely hurt results. Greff has a $73 price target on Royal Carribean Cruises, down from the previous $96. The analyst also has lowered its price target on Norwegian Cruise to $44 from $62, as he expects lower demand to also weigh on the company’s quarterly earnings. Of the 749 funds that Insider Monkey tracks, 26 were long Norwegian Cruise Line Holdings Ltd (NASDAQ:NCLH) and 39 owned shares of Royal Caribbean Cruises Ltd (NYSE:RCL) at the end of June.
Abeona Therapeutics Inc (NASDAQ:ABEO), a clinical stage biopharmaceutical company focused on developing therapies for life-threatening rare genetic diseases, is off by 2.6% after the biotech announced a public offering of 6.0 million shares at $7 a piece. In addition, the company has granted underwriters a 30-day option to buy up to an additional 900,000 shares of common stock. Abeona intends to use the net proceeds of the offering for working capital and general corporate purposes, including for the development of product candidates and general and administrative expenses. According to our records, nine funds owned $14.53 million worth of Abeona Therapeutics Inc (NASDAQ:ABEO)’s stock, which represented 18.90% of the float on June 30, versus seven funds and $15.35 million, respectively, on March 31.
On the next page, we will discuss Exxon Mobil Corporation and Chevron Corporation.