Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Why Are Investors So Excited About These Four Stocks Today?

Four stocks have investors excited about their future returns potential this morning as each of them is making big moves on the back of various tidbits of news. Let’s check in on the news that has sent shares of Natural Health Trends Corp. (NASDAQ:NHTC), Cloud Peak Energy Inc. (NYSE:CLD), Infinera Corp. (NASDAQ:INFN), and Northrop Grumman Corporation (NYSE:NOC) soaring, and whether or not investors should expect this high-flying trend to continue.

stocks, analysis, market, numbers, business, ticker, trade, money, price, investment, index, chart


Let’s start with Northrop Grumman Corporation (NYSE:NOC), which has gained 5.75% in trading today after releasing its third quarter earnings results before this morning’s opening bell. The security and defense contractor posted a big beat on the earnings side of its ledger, pulling in $2.75 in earnings per share compared to estimates of $2.20 per share. The firm’s $6 billion in revenue also beat estimates by more than $140 million. The market was also impressed with the upgraded earnings guidance for the full year, to $9.70-to-$9.80 per share from previous guidance of $9.55-to-$9.70 per share.

The gains for Northrop Grumman Corporation (NYSE:NOC) today cap off a strong October for the stock, which is up by over 15% this month. The October surge comes after we declared it a good buy at the beginning of the month, as we believed the market had pushed it down too much amid the broader market pullback. First Eagle Investment Management owned 5.89 million shares of the defense firm as of June 30, while AQR Capital Management, led by Cliff Asness, owned 2.47 million shares.

Follow Northrop Grumman Corp (NYSE:NOC)
Trade (NYSE:NOC) Now!

Most investors don’t understand hedge funds and indicators that are based on hedge funds’ activity. They ignore hedge funds because of their recent poor performance in the bull market. Our research indicates that hedge funds partly underperformed because they aren’t 100% long. Hedge funds’ fees are also very large compared to the returns generated, which reduces the net returns delivered to investors. We uncovered through extensive research that historically, hedge funds’ long positions in certain stocks actually outperformed the market greatly, and it has held true to this day. For instance, the 15 most popular small-cap stocks among funds has beaten the S&P 500 Index by more than 53 percentage points since the end of August 2012. These stocks returned a cumulative of 102% vs. less than a 49% gain for the S&P 500 Index (read the details). That’s why we believe investors should pay attention to what hedge funds are buying, particularly in the small-cap sector, rather than what their net returns are, which the media primarily focuses on.

Let’s move on to Natural Health Trends Corp. (NASDAQ:NHTC), ahead by 15.85% today on the valuation score sheet. The direct seller of health and beauty products posted its own third quarter results after the closing bell yesterday, which amounted to earnings per share of $1.18 and $80.8 million in revenue, a quarterly record for the company and up by 154% year-over-year. The Dallas-based firm also announced a 25% uptick in its dividend, to $0.05. Natural Health Trends Corp. (NASDAQ:NHTC) was beginning to garner a lot more interest from the elite hedge funds that we track during the second quarter. The number of those investors long the stock rose to nine from five, while the value of their collective holdings was more than quadrupled to over $40.61 million. Jim Simons‘ Renaissance Technologies was the largest of those shareholders, owning 295,400 shares as of June 30.

Follow Natural Health Trends Corp (NASDAQ:NHTC)
Trade (NASDAQ:NHTC) Now!

Two more market movers are analyzed on the next page.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.