The US stocks rallied on Wednesday after the dovish comments from Federal Reserve Chairwoman Janet Yellen on Tuesday. Among the prominent stocks that registered substantial gains on a strong trading volume are ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD), Lululemon Athletica inc. (NASDAQ:LULU), Apple Inc. (NASDAQ:AAPL), Vale SA (ADR) (NYSE:VALE), and Gerdau SA (ADR) (NYSE:GGB). Let’s take a closer look at the reasons behind the growth of these stocks and see the smart money sentiment surrounding them.
At Insider Monkey, we track around 730 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see more details about our small-cap strategy).
ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) surged by approximately 12% this morning after the U.S. Food and Drug Administration voted 12-2 in the favor of the company regarding its pimavanserin drug for the treatment for psychosis associated with Parkinson’s disease. The FDA committee announced on Tuesday that the benefits of the ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD)’s drug outweigh its risks. The biopharmaceutical company’s stock has jumped to reach its two-month high on the back of the news. Overall, 24 hedge funds tracked by Insider Monkey held positions in ACADIA Pharmaceuticals Inc. (NASDAQ:ACAD) at the end of fourth quarter and the total value of these positions stood at approximately $928.9 million representing some 25.80% of the company’s stock. Ken Griffin’s Citadel Investment Group owns approximately 1.1 million shares of the company.
Canadian yoga-wear retailer Lululemon Athletica inc. (NASDAQ:LULU)’s stock has gained 10% after the company declared fourth-quarter and full-year results for the fiscal year ended January 31, 2016. The company reported fourth-quarter net income of $117.4 million at $0.85 per share, beating the Wall Street’s estimates of 80 cents a share. Revenue jumped by 17% on the year to $704.3 million, easily beating the consensus estimate of $693.8 million. Lululemon expects its revenue to be at $2.34 billion from $2.29 billion for the full year. Diluted earnings per share are estimated to be around $2.05 to $2.15 for the full year. A total of 22 hedge funds out of those tracked by us held long positions in Lululemon Athletica inc. (NASDAQ:LULU) at the end of 2015, versus 33 funds a quarter earlier. The total value of hedge funds’ positions went up to approximately $728.8 million from around $837.3 million. Among the notable shareholders, billionaire Stephen Mandel’s Lone Pine Capital holds around 6 million shares of the company.