Although the broader markets are relatively quiet, shares of AT&T Inc. (NYSE:T), Time Warner Inc (NYSE:TWX), Everyday Health Inc (NYSE:EVDY), Proofpoint Inc (NASDAQ:PFPT), and ManpowerGroup Inc. (NYSE:MAN) are on the move for various reasons.
In this article, we’ll find out why traders are buying and selling each stock and use the latest 13F data to determine how successful hedge funds are positioned in each of them.
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).
Time Warner Inc (NYSE:TWX) shares have surged by 8.8% while AT&T Inc. (NYSE:T) is 3.35% in the red after the Wall Street Journal reported that the latter is in advanced negotiations to buy the former. Although the merger talks could potentially fall through, a deal could happen as early as this Saturday or Sunday. The purchase of Time Warner would help further diversify AT&T and yield substantial synergies. AT&T is in the red because shareholders fear the company might overpay in the short-term.
Of the 749 hedge funds that we track which filed 13Fs for the June quarter, 55 owned shares of AT&T Inc. (NYSE:T), while 63 owned shares of Time Warner Inc (NYSE:TWX).
Everyday Health Inc (NYSE:EVDY) is 10% in the green after the company agreed to be acquired by Ziff Davis for $10.50 in cash per share, representing an enterprise value of $465 million. Under the terms of the agreement, Ziff Davis will commence a tender offer to buy all of the company’s outstanding shares for $10.50 in cash, whereby it hopes to garner 50% or more of the shares. Eight funds in our system owned shares of Everyday Health Inc (NYSE:EVDY) at the end of the second quarter.
On the next page we’ll find out why Proofpoint and ManpowerGroup are surging today.
Proofpoint Inc (NASDAQ:PFPT) shares are 10% in the green after the company reported third-quarter EPS of $0.19 on revenue of $99.8 million. Those numbers beat the Street’s estimates by $0.14 and $5.53 million, respectively. Billings jumped by 47% year-over-year and sales rose by 44.3% as the combination of strong demand, high competitive win rates, and consistent high renewal rates powered Proofpoint’s top-line. In terms of guidance, the company expects adjusted EPS of $0.10-to-$0.14, billings of $133.5 million-to-$135.5 million, and revenue of between $103 million and $105 million for the fourth quarter. The number of funds that we track with holdings in Proofpoint Inc (NASDAQ:PFPT) fell by two during the second quarter to 20 at the end of June.
ManpowerGroup Inc. (NYSE:MAN) has jumped by 7% after the company reported strong third-quarter earnings. For the period, Manpower earned $1.87 per share, beating the consensus estimate by $0.16. Revenue came in at $5.09 billion, up by 2.4% year-over-year and $100 million ahead of expectations.
“We executed well in the third quarter despite continued soft and uneven market conditions globally. This slow growth environment results in our services and solutions becoming increasingly more attractive to companies that need operational and strategic flexibility. We have seen this translate into continued strong growth in our permanent recruitment and market leading workforce solutions offerings. As we look to the fourth quarter we are well placed to seize further opportunities across all our brands,” CEO Jonas Prising said.
As for outlook, the company anticipates fourth quarter EPS to be in the range of $1.65-to-$1.73. According to our data, 24 funds that we track owned $428.08 million in ManpowerGroup Inc. (NYSE:MAN) holdings on June 30, down from 27 funds with $628.81 million in positions on March 31.