Why General Electric, eBay, and Three Other Stocks Are in Spotlight

With all three index futures well in the green, the market looks like it will take a breather from the furious sell off move caused by the Brexit.

Among the stocks trending today are General Electric Company (NYSE:GE), NovaGold Resources Inc. (USA) (NYSEMKT:NG), eBay Inc (NASDAQ:EBAY), Live Nation Entertainment, Inc. (NYSE:LYV), and NextEra Energy Inc (NYSE:NEE). In this article, we take a closer look at each stock and see what elite funds think about the companies in question.

While there are many metrics that investors can assess in the investment process, the hedge fund sentiment is something that is often overlooked. However, hedge funds and other institutional investors allocate significant resources while making their bets and their long-term focus makes them the perfect investors to emulate. This is supported by our research, which determined that following the small-cap stocks that hedge funds are collectively bullish on can help a smaller investor to beat the S&P 500 by around 95 basis points per month (see the details here).

General Capital Continues to Shrink

General Electric Company (NYSE:GE) is in the spotlight today after it agreed to sell the bulk of its U.S. restaurant franchise loan portfolio to three different buyers. The move enhances GE’s transformation from a conglomerate to a simpler, more valuable industrial company. The transactions are expected to release around $0.2 billion of capital to GE and further shrink GE capital. With the restaurant deal, GE management has signed agreements for around $180 billion of the total planned $200 billion of GE Capital divestments. A total of 64 funds from our database were long General Electric Company (NYSE:GE) at the end of March, up by 10 funds from the previous quarter.

NovaGold Reports Earnings

NovaGold Resources Inc. (USA) (NYSEMKT:NG) reported a fiscal second quarter loss of $0.03 per share, missing estimates by $0.01 per share. At the end of May, NovaGold had $112 million in cash and term deposits, which the company believes is more than enough to advance the Donlin Gold project through completion of permitting. Shares of the company have surged almost 50% year-to-date on the back of rising gold prices. Some traders are buying gold due to the uncertainty over global macro-economic conditions. Among the funds we track, 22 funds owned $354.5 million worth of NovaGold Resources Inc. (USA) (NYSEMKT:NG), which accounted for 22.00% of the float on March 31, versus 15 funds and $301.77 million, respectively, on December 31.

On the next page, we examine eBay, Live Nation Entertainment, and NextEra Energy.
StubHub Wins a Major Deal

eBay Inc (NASDAQ:EBAY) is trending after its subsidiary StubHub struck a 6.5-year contract to resell tickets on its platform for the New York Yankees, replacing Live Nation Entertainment, Inc. (NYSE:LYV)‘s Ticketmaster. Although ESPN reported that the deal could net the Yankees $100 million, StubHub said the value of the deal is ‘definitely not that high’ and that the terms of the deal are based on revenue sharing. Given that the Yankees and StubHub previously bickered over ticket pricing, it seems that the current deal marks a detente of sorts for the two giants. A total of 57 funds from our database owned shares of eBay Inc (NASDAQ:EBAY) at the end of the first quarter, down by 15 funds from the previous quarter. Meanwhile, the number of funds with holdings in Live Nation Entertainment, Inc. (NYSE:LYV) inched up by one quarter-over-quarter to 38 in the same time period.

NextEra Energy in Lead Position on Utility Deal

According to Bloomberg, NextEra Energy Inc (NYSE:NEE) is in the pole position in terms of potentially acquiring Texas utility Oncor Electric Delivery Co. NextEra has submitted a competitive bid and is in negotiations to buy the utility with a mix of cash and debt that could amount to $17-$18 billion. At least six other companies have also expressed interest in the utility. At the end of March, 35 funds owned shares of NextEra Energy Inc (NYSE:NEE).

Disclosure: none