Shares of Ralph Lauren Corp (NYSE:RL) and Novavax, Inc. (NASDAQ:NVAX) both popped in after-hours trading on Tuesday on the back of announcements that appeared to be welcomed by the market. Ralph Lauren announced that its eponymous founder and top executive will hand over the chief executive post to former Old Navy and H&M executive Stefan Larsson. Meanwhile, Novavax said that a mid-stage study showed that its vaccine for the respiratory syncytial virus was safe for pregnant women, immunizing both mothers and their infants. Let’s take a closer look at the recent developments for both companies and assess whether hedge funds see a long-term potential in these companies.
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Ralph Lauren Corp (NYSE:RL) has announced the appointment of Stefan Larsson as its chief executive officer, after being global brand president of Old Navy since 2012, revitalizing the once struggling Gap, Inc. (NYSE:GPS)’s brand. Ralph Lauren, the iconic founder of the company, will be executive chairman and chief creative officer, which means that the 75-year-old designer still wields a considerable amount of control in his firm. Before reviving Old Navy, Larsson spent 15 years at H&M, laying the foundation of this Swedish cheap chic fashion business’ global rise. Larsson is expected to lead Ralph Lauren in a fast-changing fashion business environment. His appointment followed the hiring of Yves Saint Laurent CEO Valerie Hermann last year to become Ralph Lauren’s president in the luxury segment. The fashion firm has also been creating new labels to extend their reach and remain relevant.
Hedge funds, however, are not fond of Ralph Lauren Corp (NYSE:RL), whose stock has plunged by over 44% year-to-date. There were 28 hedge funds from our database with long positions in Ralph Lauren at the end of June, seven less than the preceding quarter. While the company’s stock was essentially flat during the second quarter, the value of hedge funds positions decreased by 8.94% to $610.63 million. Nonetheless, hedge funds held 7.70% of Ralph Lauren at the end of June. Cliff Asness’ AQR Capital Management owned 847,362 shares of Ralph Lauren at the end of June, after more than doubling its stake during the quarter.