Why AMD, Hovnanian, and Three Other Stocks Are Down Today

We believe that imitating hedge funds and other large institutional investors can be helpful in identifying stocks capable of outperforming the broader market. Through extensive research that covered portfolios of several hundred large investors between 1999 and 2012, we determined that following the small-cap stocks that large money managers are collectively bullish on, can generate monthly returns nearly 1.0 percentage points above the market (see the details here).

Technical Selling Causes AMD to Retreat

Although Advanced Micro Devices, Inc. (NASDAQ:AMD) CEO Lisa Su expects the company to be profitable on an operating basis for the second half of 2016, shares of the company are nevertheless down by 7.22% today as traders take profit on the stock run-up. AMD shares have more than doubled from their February lows, and shares might need to consolidate a bit before the stock can find a stronger technical footing. Billionaire Jim Simons’ Renaissance Technologies owned almost 800,000 shares of Advanced Micro Devices, Inc. (NASDAQ:AMD) at the end of March.

Sarepta Therapeutics Down on FDA Press Release

Sarepta Therapeutics Inc (NASDAQ:SRPT) is 19% lower after the FDA published a press release stating that it had completed its push to streamline the process used by doctors to request expanded access to investigational drugs for their patients. Some traders evidently thought the timing of the FDA press release concerning the agency’s finished efforts might increase the chance that the agency won’t approve eteplirsen, Sarepta’s lead candidate for the treatment of Duchenne muscular dystrophy. Some profit taking could also be another reason for today’s decline. Sarepta Therapeutics Inc (NASDAQ:SRPT) shares will likely continue to be volatile until the FDA makes a final decision on the drug. A total of 19 elite funds tracked by Insider Monkey owned around 1/3 of the company at the end of the first quarter.

On the next page, we examine Titan Pharmaceuticals, Hovnanian Enterprises, and DeVry Education Group.

Titan Pharmaceuticals Lower on Profit Taking

Titan Pharmaceuticals, Inc. (NASDAQ:TTNP) shares have retreated by 3.1% as some traders take profit on the stock’s more than 100% rally from early January. The company’s stock rallied sharply on May 27 before falling in a classic sell-the-news event after the FDA approved Titan’s buprenorphine implant for the treatment of opioid dependence. Given that at the moment it is unclear how much revenue the buprenorphine implant will ultimately achieve, look for Titan Pharmaceuticals, Inc. (NASDAQ:TTNP)’s stock to remain volatile.

Hovnanian Turns In Dissapointing Quarter

Hovnanian Enterprises, Inc. (NYSE:HOV) is almost 12% lower today after the company reported a fiscal second-quarter loss of $0.06 per share on revenue of $654.7 million, versus estimates of a profit of $0.02 per share and revenue of $643.06 million. Adjusted gross margin before interest and land charges amounted to 16.1%, while the dollar value of the company’s backlog rose 27.8% year-over-year to $1.58 billion. The number of homes in the backlog jumped 11.7% to 6,453 houses. Management expects adjusted EBITDA of $200-$225 million on revenue of $2.7-$2.9 billion for fiscal year 2016. Of the 766 total elite funds in Insider Monkey’s database, 9 held shares in Hovnanian Enterprises, Inc. (NYSE:HOV) at the end of March.

Executive Churn in DeVry Education Group 

The sudden change of high-level executives in DeVry Education Group Inc (NYSE:DV) is making some shareholders anxious. Shares of the company are down by 14% after DeVry named a new CFO, Patrick Unzicker, to replace the former CFO, Timothy Wiggins. Just last week, the company appointed Lisa Wardell as the new CEO to replace Daniel Hamburger. Investors hope the management churn isn’t indicative of bigger problems down the road. DeVry Education Group Inc (NYSE:DV) was in 13 top fund portfolios at the end of March, down from 14 at the end of December.

Disclosure: none