Although the bulk of the second quarter earnings season has already passed, five companies are each in the spotlight this morning after reporting the financial results for their latest quarters yesterday.
In this article, we’ll examine how Five Below Inc (NASDAQ:FIVE), salesforce.com, inc. (NYSE:CRM), Box Inc (NYSE:BOX), Infoblox Inc (NYSE:BLOX), and Ollie’s Bargain Outlet Holdings Inc (NASDAQ:OLLI) performed during their latest quarters and use SEC filings to determine how the world’s most prominent hedge funds are positioned in them.
Hedge fund sentiment is an important metric for assessing the long-term profitability. At Insider Monkey, we track over 750 hedge funds, whose quarterly 13F filings we analyze and determine their collective sentiment towards several thousand stocks. However, our research has shown that the best strategy is to follow hedge funds into their small-cap picks. This approach can allow monthly returns of nearly 95 basis points above the market, as we determined through extensive backtests covering the period between 1999 and 2012 (see the details here).
Softer-Than-Expected Guidance at Five Below
Five Below Inc (NASDAQ:FIVE) shares are in the red in extended market trading after the company reported second quarter earnings of $0.18 per share on revenue of $220.1 million (up by 20.8% year-over-year due to a 3.9% increase in comparable-store sales). Although earnings beat the consensus estimate by $0.01 per share and revenue exceeded the average target by $0.51 million, the company’s full-year revenue guidance was lower-than-expected. Management anticipates full-year 2016 revenue of $1.00 billion-to-$1.009 billion, slightly below estimates of $1.01 billion on the top-end of the range. Five Below expects to deliver EPS of $1.28-to-$1.32 for the year. Of the 749 hedge funds that Insider Monkey tracks which filed 13F’s for the June 30 reporting period, 13 were long Five Below Inc (NASDAQ:FIVE).
Salesforce.com’s Guidance Disappoints
Although it comfortably beat second quarter expectations, salesforce.com, inc. (NYSE:CRM)‘s third quarter guidance wasn’t as strong as expected and its stock is off by around 8% in extended trading as a result. For the second quarter, salesforce.com, inc. (NYSE:CRM) reported EPS of $0.24 on revenue of $2.04 billion, beating estimates by $0.02 and $20 million respectively. Sales grew by 25.2% year-over-year, while deferred revenue jumped by 26% year-over-year. What hurt the stock was the company’s third quarter guidance of adjusted EPS of $0.20-to-$0.21 on revenue of $2.11 billion-to-$2.12 billion, while analysts were expecting $0.24 per share in earnings and $2.13 billion in sales. Eashwar Krishnan‘s Tybourne Capital Management raised its stake in the cloud enterprise software provider by 141% during the second quarter, to over 2.36 million shares which accounted for 9.74% of its portfolio’s value.
On the next page we’ll examine the results out of Box Inc, Infoblox Inc, and Ollie’s Bargain Outlet.