It’s a red day on Wall Street, as all three major indexes are down. The Dow is off by more than 100 points, the S&P is below 2,100, and the Nasdaq index is off by 1% as some traders go into ‘risk off’ mode in anticipation of a potential Brexit. Among the stocks in the spotlight today are Twitter Inc (NYSE:TWTR), Yahoo! Inc. (NASDAQ:YHOO), Amazon.com, Inc. (NASDAQ:AMZN), Medtronic PLC (NYSE:MDT), and Applied Materials, Inc. (NASDAQ:AMAT). Let’s dive in to why these stocks are trending and see what elite funds think of 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 here).
Instagram Surpasses Twitter
According to Strata, Facebook Inc (NASDAQ:FB)‘s Instagram is attracting more social media ad campaigns than Twitter Inc (NYSE:TWTR). Twitter Inc (NYSE:TWTR) has struggled of late to monetize and grow its audience and its stock is down sharply from a year ago, by over 60%, including a 3% dip today. Although Instagram and Snapchat were founded years after Twitter, the two apps have since surpassed the company. Twitter bulls are holding out hope that CEO Jack Dorsey can turn the company around. Of the 766 active funds that we track, 27 funds owned $403.17 million worth of Twitter Inc (NYSE:TWTR) shares on March 31, which accounted for 3.50% of the stock’s float.
Yahoo! Auction Moves Forward
Yahoo! Inc. (NASDAQ:YHOO)‘s core assets are moving closer to being sold, as the company is putting together a shortlist of competitive offers following the second round of bids. The offers from the second round are purportedly greater than Verizon Communications Inc. (NYSE:VZ)’s $3.5 billion bid. Like Twitter, Yahoo! Inc. (NASDAQ:YHOO) has struggled to turn a meaningful profit from its core assets. Various hedge fund managers believe Yahoo management could create more value by selling those core assets and becoming a holding company instead. 97 top funds in our database owned shares of Yahoo at the end of the first quarter.
On the next page we examine why Amazon.com Inc, Medtronic PLC, and Applied Materials Inc are grabbing attention today.