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 These Five Stocks Are in Spotlight Today?

The U.S. stock market inched down on Monday amid a volatility in crude prices and following last week’s U.S. jobs report which led to gains at the end of the last week. Some major acquisitions and deals also moved important stocks today. Among the stocks to watch today are  Alaska Air Group, Inc. (NYSE:ALK), Virgin America Virgin America Inc (NASDAQ:VA), Brocade Communications Systems, Inc. (NASDAQ:BRCD), Ruckus Wireless Inc (NYSE:RKUS), Groupon Inc (NASDAQ:GRPN), and Tesla Motors Inc (NASDAQ:TSLA). This article explains the reasons behind the changes in these stocks in detail along with hedge funds’ sentiment around them.

At Insider Monkey, we track around 790 hedge funds and other 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).

Alaska Air Group, Inc. (NYSE:ALK)’s stock has declined approximately 5% on Monday following its announcement that it would acquire Virgin America Virgin America Inc (NASDAQ:VA) in a $2.60 billion. This acquisition would create the fifth largest US airline. Alaska Air Group, Inc. (NYSE:ALK) will pay $57 per share for Virgin America Inc (NASDAQ:VA), which represents a 47% premium to the company’s Friday closing price of $38.90. Alaska Air won the bidding war for this acquisition against JetBlue. Following the news, Virgin America Inc (NASDAQ:VA)’s shares surged by approximately 40%. According to the terms of the agreement, Virgin America Inc (NASDAQ:VA) would have to pay Alaska Air $78.5 million if the agreement is terminated.

A total of 32 funds tracked by us held positions in Alaska Air Group at the end of fourth quarter 2015 having amassed 11.7% of the company’s total stock. Jim Simons’s Renaissance Technologies is one of the largest stakeholder in the company with the ownership of more than 4 million shares. At the same time, 20 investors held positions in Virgin America, which represented 33% of the company’s total stock. Among these funds, Stephen C. Freidheim’s Cyrus Capital Partners has the largest stake, containing 10 million shares at the end of 2015.

Follow Alaska Air Group Inc. (NYSE:ALK)
Trade (NYSE:ALK) Now!

In other M&A news, networking hardware company Brocade Communications Systems, Inc. (NASDAQ:BRCD) announced today that it is going to buy  Ruckus Wireless Inc (NYSE:RKUS) for approximately $1.5 billion in a cash-and-stock deal. According to the terms of the merger agreement, shareholders of Ruckus Wireless Inc (NYSE:RKUS) will receive $6.45 in cash and 0.75 shares of Brocade for each share of Ruckus. The deal values Ruckus at $14.43 per share, based on the closing prices of both companies on Friday. This would amalgamate Ruckus Wireless Inc (NYSE:RKUS)’s wireless services with the networking hardware and software business of Brocade Communication. Following the news, Brocade’s stock plummeted by 15%, whereas Ruckus’ stock soared by 30%. Brocade Communication has also raised its share buyback program by $800 million, taking the total to approximately $1.7 billion.

A total of 29 investors tracked by us held positions in Brocade with a total value of $514.5 million, which represented around 13.7% of the company stock at the end of the last year. Cliff Asness‘ AQR Capital Management owns approximately 16 million shares of the company. In Ruckus Wireless, 12 funds from our database reported stakes worth $89.1 million in aggregate. John W. Rogers’ Ariel Investments holds some 2 million shares of the company.

Follow Brocade Communications Systems Inc (NASDAQ:BRCD)
Trade (NASDAQ:BRCD) Now!

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.