Why Jack in the Box, LSB Industries and Others Are Gaining Ground Today?

Markets bounced back from an early morning decline amid news of important buyout deals. Among the stocks that are flying today are Jack in the Box Inc. (NASDAQ:JACK), LSB Industries, Inc. (NYSE:LXU), Infoblox Inc (NYSE:BLOX), Cheniere Energy, Inc. (NYSEMKT: LNG) and MGT Capital Investments Inc. (NYSEMKT:MGT). Let’s see why these stocks are gaining ground today and see what smart money investors think about them.

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Jack in the Box Beats Estimates

Jack in the Box Inc. (NASDAQ:JACK)’s stock has surged more than 14% so far today after the company posted better-than-expected financial results for its fiscal second quarter. The Sand Diego-based restaurant company reported earnings of $0.85 a share on $361 million revenue, higher than the estimates of $0.70 in EPS on revenue of $360 million. In a statement, CEO of Jack in the Box, Leonard Comma, said that healthy margins and labor cost controls resulted in better sales. The company also got huge benefits from Mexican fast-casual chain Qdoba, which it had acquired in 2003.  Same store sales at Qdoba rose by 2.1% on the year. For the current quarter, Jack in the box expects a 2% to a flat decline in its same store sales amid heavy rainfall and flooding in Houston, where 17% of the company’s stores are located. Overall, 22 hedge funds from our system were positioned in Jack in the Box Inc. (NASDAQ:JACK) at the end of last year. As of the end of March, Michael Barnes and Arif Inayatullah’s Tricadia Capital Management owns 46,000 shares of the company.

LSB Industries to Sell Its Climate Control Business

Shares of LSB Industries, Inc. (NYSE:LXU) have skyrocketed by more than 37% after the company announced that it will sell its climate control business to Sweden-based company NIBE Industrier AB for $364 million. In a statement, Dan Greenwell, President and CEO of the Pennsylvania based company, said that the deal would help LSB to focus entirely on its chemical business. The company will use the cash to pay off its debt. It will have more flexibility and capital to ensure its growth in the chemical business. The deal will be closed in the third quarter of the current year. As of the end of March, Murray Stahl’s Horizon Asset Management owns 793,390 shares of LSB Industries.

On the next page, we are going to take a look at the reasons that have helped the other three stocks gain ground today.

Thoma Bravo Approaches Infoblox For a Buyout

Shares of Infoblox Inc (NYSE:BLOX) have advanced by more than 22% on Thursday on the back of a Bloomberg report that claimed that the company was approached by technology-focused private equity firm Thoma Bravo for a buyout. In order to explore its options, Infoblox is considering to hire advisers, the report added. The alleged buyout offer comes three weeks after Starboard Value had acquired a massive 7.5% stake in Infoblox. Jack Ripsteen’s Potrero Capital Research owns 289,490 shares of Infoblox Inc (NYSE:BLOX). It is one of the 27 hedge funds having long positions in the company as of the end of last year. The total worth of these positions in approximately $267.7 million.

Cheniere Energy Gets a New CEO

Cheniere Energy, Inc. (NYSEMKT:LNG)’s stock grew by more than 7% today after the company appointed Jack Fusco, an experienced power sector executive, as its CEO. Back in December, Cheniere Energy’s board ousted the company’s founder and CEO, Charif Souki, after pressure from billionaire investor Carl Icahn. Problems for Mr. Souki started when he proposed plans to cool natural gas into liquefied gas for exports, a digression from the company’s core plan. At the end of 2015, 54 investors, out of nearly 786 funds we track at Insider Monkey, had approximately $5.8 billion worth Cheniere Energy, Inc. (NYSEMKT:LNG)’s shares. Gifford Combs’s Dalton Investments owns 439,187 shares of the company, according to its 13F filing for the end of the March quarter.

MGT Capital Buys Ownership Interest in Round House

MGT Capital Investments Inc. (NYSEMKT:MGT) soared more than 18% today after the company announced its acquisitions of ownership interest in technology incubator Round House. Round House in an Alabama-based incubator which offers co-working spaces, accelerator services and angel investment to startups. In a statement, MGT said that the deal gives a valuable pipeline to the company and an equity in first aid kit start-up RecMed First Aid. MGT Capital Investments said that it will have a chance to interact with a wide range of innovative and potentially disruptive companies in the Round House portfolio, from the areas of file sharing, chat and other applications. Only two hedge funds from our system reported long positions in MGT Capital Investments Inc. (NYSEMKT:MGT) as of the end of 2015.

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