Why These Stocks Are on the Move on Tuesday

Markets are sharply up on Tuesday as post-Brexit fears abate and in the US, three main indexes are well in the green today.

Among the most noteworthy stocks which are gaining ground today are ReachLocal Inc. (NASDAQ:RLOC), Twilio Inc (NYSE:TWLO), Carnival Corp (NYSE:CCL), Whiting Petroleum Corp (NYSE:WLL) and Petroleo Brasileiro SA Petrobras (ADR) (NYSE:PBR). Let’s take a closer look at the latest developments surrounding these stocks today and see the hedge fund sentiment towards each company in question.

We determine hedge fund sentiment by analyzing the equity portfolios of some of the best-performing hedge funds and institutional investors. Through extensive research, we have determined that the due diligence that these investors employ, as well as their long-term focus makes them perfect targets to emulate. However, the results of our analysis have also showed that the small-cap picks of these funds can generate much better returns, with the 15 most popular small-cap stocks beating the market by an average of 95 basis points per month (read more details here).

Media Giant Gannett to Acquire ReachLocal

Shares of ReachLocal Inc. (NASDAQ:RLOC) of have skyrocketed more than 173% in value today after Gannett, the largest U.S. newspaper publisher as measured by total daily circulation, announced that it had reached an agreement to acquire ReachLocal for approximately $156 million. Gannett said that the acquisition of ReachLocal will increase its digital revenue by roughly 50%. In a statement, ReachLocal’s CEO Sharon Rowlands said that the “powerful combination” of Gannett and ReachLocal will drive growth and help the companies in increasing innovation.

Only three funds from our database were bullish on ReachLocal Inc. (NASDAQ:RLOC) at the end of the first quarter. Among them, Douglas T. Granat’s Trigran Investments has the biggest stake, with more than 3.9 million shares of the company.

Twilio: A Hope for the Unicorn Tech Startups

Twilio Inc (NYSE:TWLO), the Unicorn startup from San Francisco, which went public on Thursday, continues to make headlines, amid the hopes it has infused in the startup ecosystem and IPO market dynamics of technology companies. Twilio went at $15 a share, and managed to surge by 91% to reach $28 in a single session. However, the company couldn’t maintain this stock growth due to the Brexit bombshell, which devastated almost everything on the Street. Yesterday on CNBC, Jim Cramer said that Twilio’s performance depicts that unicorns still have value, and they are not just “mythical creatures” with unrealistic valuations and expectations.

We discuss why shares of Carnival Corp, Whiting Petroleum and Petroleo Brasileiro are gaining value today on the next page.

Carnival Corp Beats Estimates

Carnival Corp (NYSE:CCL) opened higher but has pared the gains after the company posted fiscal second quarter results that topped analysts’ estimates. The Miami, Florida-based cruise line operator reported EPS of $0.49, better than the estimated $0.39. Revenue in the quarter increased by 3.2% to $3.71 billion, mainly due to increase in ticket prices and on-board spending. For full fiscal 2017, the company narrowed its EPS forecast to $3.25-$3.35, from $3.20-$3.40. Carnival Corporation’s CEO Arnold Donald said in a statement that the strong quarterly results show that the company continues to gain momentum despite the recent currency movements and the increase in fuel prices. Mr. Donald added that the company has several projects scheduled for the future including re-mastering of Queen Mary 2, the launch of Denali square complex in Alaska and the introduction of new cruises. A total of 48 hedge funds from our database had approximately $1.4 billion worth of Carnival Corp (NYSE:CCL)’s stock at the end of March. Kerr Neilson’s Platinum Asset Management owns about 5.45 million shares of the company.

Whiting Petroleum Rebounds

Whiting Petroleum Corp (NYSE:WLL) is rebounding today after getting hammered following its announcement of debt exchange for convertible notes offering last week. The Denver-based oil and gas company had announced a $1.064 billion debt-for-equity swap, which made the stock nosedive. Tuesday’s market rally and a rise in oil prices is helping the shares of Whiting Petroleum gain momentum. Debra Fine’s Fine Capital Partners is one of the 43 funds from our database that reported long positions in Whiting Petroleum Corp (NYSE:WLL) as of the end of the first quarter. It owns around 9.68 million shares of the company.

Petroleo Brasileiro Up on Oil Prices

Petroleo Brasileiro SA Petrobras (ADR) (NYSE:PBR) is in the spotlight on Tuesday amid a growth in oil prices on Tuesday. The company has recently announced plans to amend the terms of its formerly declared offer to purchase for cash any and all of its partner Petrobras Global Finance’s Notes due 2018. Shares of Petroleo Brasileiro have surged more than 7% so far today. Among the funds tracked by Insider Monkey, 23 funds had piled up shares of Petroleo Brasileiro SA Petrobras (ADR) (NYSE:PBR) at the end of the first quarter. Ken Fisher’s Fisher Asset Management owns more than 10.5 million shares of the company.

Disclosure: none