It’s a red day on Wall Street as all three indexes have opened in the red. The S&P 500 is off 0.7%, the Dow is down 100 points, and the NASDAQ is off almost three quarters of a percent. Among the stocks buzzing today are Yahoo! Inc. (NASDAQ:YHOO), Macy’s, Inc. (NYSE:M), Alibaba Group Holding Ltd (NYSE:BABA), Valeant Pharmaceuticals Intl Inc (NYSE:VRX), and The Kroger Co (NYSE:KR). Let’s see how elite funds are positioned among the five stocks and take a closer look at the events causing each to be in the spotlight.
We believe that imitating hedge funds and other large institutional investors can be helpful in identifying stocks capable of outperforming the broader market. Through extensive research that covered portfolios of several hundred large investors between 1999 and 2012, we determined that following the small-cap stocks that large money managers are collectively bullish on, can generate monthly returns nearly 1.0 percentage points above the market (see the details here).
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Analysts Upgrade Yahoo
Analysts at Citigroup have upgraded Yahoo! Inc. (NASDAQ:YHOO) to ‘Buy’ from ‘Neutral’ and bumped up their price target to $40.79 per share from $37.32 per share. The analysts cited six factors that have created a favorable risk/reward for shares, including Alibaba’s agreement to buy back shares from Softbank, Alibaba’s more positive outlook, and credible news reports of the sales auction. In regards to the auction, the analysts at Citigroup think Yahoo’s all-in sale price of its core assets will fetch at least $5 billion, and the implied discount to Alibaba and Yahoo Japan will shrink after Yahoo sells off those assets. Among the funds we track, 97 funds owned $7.92 billion worth of Yahoo! Inc. (NASDAQ:YHOO)’s stock, which accounted for 22.70% of the float on March 31, versus 84 funds and $5.92 billion, respectively, a quarter earlier.
Follow Altaba Inc. (NASDAQ:AABA)
Follow Altaba Inc. (NASDAQ:AABA)
Macy’s Prevents Labor Stoppage
Macy’s, Inc. (NYSE:M) is slightly higher after the retailer struck a tentative deal with a union representing 3,500 workers at the company’s flagship store in NYC and 1,500 workers elsewhere. The Retail, Wholesale, and Department Store Union wanted Macy’s to address issues concerning pensions, health care, and scheduling. The union and Macy’s management pulls an all-nighter to reach a deal satisfactory to both sides to avert a strike. A total of 55 funds from our database had a long position in Macy’s, Inc. (NYSE:M) at the end of the first quarter.
Follow Macy's Inc. (NYSE:M)
Follow Macy's Inc. (NYSE:M)
On the next page, we examine Alibaba Group Holding, Valeant Pharmaceuticals, and The Kroger Co.
