With crude futures in the green for the first time in 2016 and the S&P 500 barely in the red this morning, shares of Express Scripts Holding Company (NASDAQ:ESRX), Qorvo Inc (NASDAQ:QRVO), SUPERVALU INC. (NYSE:SVU) and BorgWarner Inc. (NYSE:BWA) are falling hard. Let’s find out why investors are selling these equities today as well as what relevant hedge funds have to say about these stocks.
Let’s first take a step back and analyze how tracking hedge funds can help an everyday investor. Through our research, we discovered that a portfolio of the 15 most popular small-cap picks of hedge funds beat the S&P 500 Total Return Index by nearly a percentage point per month on average between 1999 and 2012. On the other hand the most popular large-cap picks of hedge funds underperformed the same index by seven basis points per month during the same period. This is likely a surprise to many investors, who think of small-caps as risky, unpredictable stocks and put more faith (and money) in large-cap stocks (read the details here). Follow the smart money into only their best investment ideas all while avoiding their high fees.
First on the list is Express Scripts Holding Company (NASDAQ:ESRX), whose stock has plummeted by 6.5% after Bloomberg reported that the company has received a threat from Anthem Inc (NYSE:ANTM) to take its services elsewhere unless the latter can deliver $3 billion-a-year in drug cost savings. Moreover, Anthem’s CEO has not confirmed the renewal of the firm’s contract with Express Scripts when it expires in 2019.
Express Scripts Holding Company (NASDAQ:ESRX) lost popularity in the third quarter of 2015, as out of the 730 funds that we track, 58 funds held shares of the company on September 30, amassing 6.3% of the float, down from 62 funds on June 30. Bob Peck and Andy Raab’s FPR Partners was the largest shareholder of Express Scripts in our system, with 4.87 million shares valued at $394.6 million at the end of September.
Qorvo Inc (NASDAQ:QRVO)’s shares are down by around 9% today. Although there is no particular news behind the move, the company was subject to various price reductions because of an expected weaker demand for iPhones. For example, analysts at Northland Securities cut their price target to $55 per share from $75 per share, while analysts at DA Davidson trimmed their target price on the stock to $75 from $80. Nonetheless, many analysts have maintained a “Buy” rating on it.
Among the funds we follow, 27 reported long positions in Qorvo Inc (NASDAQ:QRVO) as of the end of September, down by seven funds from a quarter earlier. Richard Barrera‘s Roystone Capital Partners reported holding a $124.3 million position in the stock as of that time, comprising 5.9% of its 13F portfolio.
We look into why the shares of SUPERVALU and BorgWarner are sliding on the next page.