The markets are relatively calm today as traders await Thursday’s release of the latest jobless claims and GDP figures.
In this article, we’ll analyze why Origin Agritech Ltd. (NASDAQ:SEED), Galectin Therapeutics Inc (NASDAQ:GALT), Avis Budget Group Inc. (NASDAQ:CAR), Hertz Global Holdings, Inc (NYSE:HTZ), and Cintas Corporation (NASDAQ:CTAS) are trending this morning and use the latest SEC filings to see how successful hedge funds have been trading these stocks.
Our backtests that covered the period between 1999 and 2012 showed that following the 15 most popular small-caps among hedge funds can help a retail investor beat the market by an average of 95 basis points per month (see the details here).
Origin Agritech Ltd. (NASDAQ:SEED) shares have soared by 21% in morning trading after the company entered into a definitive agreement to sell its China-based commercial corn seed distribution and production business for RMB400 million, or around $60 million, to Beijing Shihui Agricultural Development Co, Ltd. In addition, the acquirer will enter into a separate license agreement to pay Origin a royalty stream for its present and future product portfolio as well as a technology access fee for various R&D. The transaction is expected to close in the first quarter of 2017. Given its nano-cap nature, none of the 749 funds that we track which filed 13Fs for the latest reporting period held shares of Origin Agritech Ltd. (NASDAQ:SEED).
Galectin Therapeutics Inc (NASDAQ:GALT) shares have plunged by over 41% after the company reported disappointing top-line results from NASH-FX, a Phase 2a clinical trial evaluating the efficacy and safety of GR-MD-02 in 30 nonalcoholic steatohepatitis patients with advanced fibrosis. According to the company, the study did not meet its primary biomarker endpoint, nor did it meet the secondary endpoints that measure liver stiffness as a surrogate for fibrosis. To support the funding of another NASH trial, NASH-CX, the company has closed private placement financing for $1.5 million. As per our database, three funds that we follow owned shares of Galectin Therapeutics Inc (NASDAQ:GALT) at the end of June, up by one quarter-over-quarter.
On the next page, we’ll take a closer look at why Avis Budget Group, Hertz, and Cintas Corporation are in the spotlight.
Hertz Global Holdings, Inc (NYSE:HTZ) and Avis Budget Group Inc. (NASDAQ:CAR) are in the spotlight after Avis CFO Dave Wyshner said at Deutsche Bank’s Leverage Finance Conference that summer sales in Europe might be disappointing due to terrorism worries and macro negatives. The macro negatives also impacted pricing “across the industry.” Wyshner commented:
“Trends in July had been largely tracking our expectations, so we weren’t anticipating the imbalance between supply and demand that developed in Europe and negatively impacted peak pricing across the industry in August. For what it’s worth, my sense is that this softness was driven more by security concerns than by the Brexit vote, or the Olympics, or the broader economy, but all four probably played a role. I’d put the negative impact of the disappointing August on international EBITDA in the single-digit millions range compared to our expectations for the month.”
33 funds in our system were long Avis Budget Group Inc. (NASDAQ:CAR) on June 30, while 38 were shareholders of Hertz Global Holdings, Inc (NYSE:HTZ).
Cintas Corporation (NASDAQ:CTAS) shares are 3.55% in the green after the company reported EPS of $1.26 on revenue of $1.29 billion for its fiscal year 2017 first quarter, exceeding the consensus estimates by $0.18 and $10 million, respectively. Sales rose by 7.5% year-over-year. In terms of guidance for its fiscal 2017, the company raised its EPS outlook to $4.55-to-$4.63 from the previous range of $4.35-to-$4.45. Analysts were expecting $4.42. Meanwhile, Cintas sees revenue for the period coming in at $5.16 billion-to-$5.225 billion, with the consensus of $5.19 billion falling smack dab in the middle of its range. First Eagle Investment Management reported owning a stake of 5.56 million shares in Cintas Corporation (NASDAQ:CTAS) as of the end of June, down by 27% from the end of March.