After rallying to above $47 per barrel, WTI futures are once again in the red as some traders remain cautious on OPEC’s tentative agreement to cut production.
In this article, let’s take a closer look at five stocks that are commanding traders’ attention on Tuesday, Intrepid Potash, Inc. (NYSE:IPI), Patterson Companies, Inc. (NASDAQ:PDCO), Amazon.com, Inc. (NASDAQ:AMZN), Fiat Chrysler Automobiles NV (NYSE:FCAU), and Alibaba Group Holding Ltd (NYSE:BABA). In addition, we are going to determine what the smart money thinks of each stock.
While there are many metrics that investors can assess in the investment process, the hedge fund sentiment is something that is often overlooked. However, hedge funds and other institutional investors allocate significant resources while making their bets and their long-term focus makes them the perfect investors to emulate. This is supported by our research, which determined that following the small-cap stocks that hedge funds are collectively bullish on can help a smaller investor to beat the S&P 500 by around 95 basis points per month (see the details here).
Nano-cap Intrepid Potash, Inc. (NYSE:IPI) has surged by 12% after the company announced in a press release that it ‘will be engaging an investment banker to assess, evaluate and, if determined to be appropriate by Intrepid in its business judgement, assist in pursuing potential strategic alternatives available to the Company’. In addition, Intrepid announced that it has reached an agreement with its noteholders to amend the terms of its senior notes and concurrently, the company has entered into a new revolving credit agreement with the Bank of Montreal which provides additional borrowing capacity of up to $35 million, subject to certain terms. Howard Guberman‘s Gruss Asset Management initiated a new stake of 1.1 million shares of Intrepid Potash, Inc. (NYSE:IPI) during the second quarter.
Patterson Companies, Inc. (NASDAQ:PDCO) shares are 3.3% in the green after Northcoast analyst Edwin Snyder weighed in on market rumors that there could be a potential partnership in the works between Patterson and Amazon.com, Inc. (NASDAQ:AMZN). While he hasn’t verified the veracity of the rumor through his sources, Snyder does acknowledge that Amazon has shown strong interest in selling consumable products to dentists. Given Patterson’s efforts to disrupt dental distribution, both companies could benefit if they formed a partnership. With that said, Snyder maintains his view that Patterson is undervalued with or without an Amazon partnership, as the analyst has a ‘Buy’ rating and a $65 price target. Of the around 749 funds that we track, 22 were long Patterson Companies, Inc. (NASDAQ:PDCO) and 145 funds held shares of Amazon.com, Inc. (NASDAQ:AMZN) at the end of June.
On the next page, we find out why the spotlight is shining on Fiat Chrysler Automobiles NV, and Alibaba Group Holding Ltd.
Fiat Chrysler Automobiles NV (NYSE:FCAU) is in the red after the company reported soft domestic sales for the month of October. The company’s U.S. sales fell by 10% year-over-year to 176,609 units last month, with retail accounting for 77% of total sales and fleet sales representing the rest. Fiat Chrysler sales in the United States pale in comparison to GM’s October domestic sales, in which the giant from Detroit reported total sales falling just 1.7%. The number of funds from our database with holdings in Fiat Chrysler Automobiles NV (NYSE:FCAU) fell by one quarter-over-quarter to 27 at the end of June.
Traders are keeping a close eye on Alibaba Group Holding Ltd (NYSE:BABA) after the New York Post reported that a federal probe of Alibaba’s accounting is still ongoing and that the SEC has help from at least one whistle-blower who the Post describes as a high up official in the company looking for a potential monetary reward. Alibaba, which disclosed the SEC probe in May, has said it is fully cooperating with regulators. A total of 69 funds tracked by Insider Monkey were long Alibaba Group Holding Ltd (NYSE:BABA) at the end of the second quarter, up by two funds from the previous quarter.