Amazon.com, Inc. (NASDAQ:AMZN) is in the spotlight after Warren Buffett’s Berkshire Hathaway finally bought shares in the company. While Warren Buffett himself wasn’t responsible for the purchase — one of his investing lieutenants was — the stock still is in the spotlight as some stocks that Buffett’s lieutenants buy such as Apple could be later bought by Buffett himself. Given that Amazon.com has a big market cap, the buying may not move the stock very much, however. Buffett said on CNBC, “One of the fellows in the office that manage money … bought some Amazon so it will show up in the 13F”. Of the around 700-740 elite funds we track, 168 funds owned $19.02 billion of Amazon.com, Inc. (NASDAQ:AMZN) on December 31, versus 150 funds and $21.77 billion respectively on September 30.
Amazon.com isn’t the only company in the news, let’s take a look at some other stocks that are trending and how the smart money is positioned among them.
Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 32 percentage points since May 2014 through March 12, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Tesla Inc. (NASDAQ:TSLA) is in the spotlight after the CEO said in an investor call that autonomous driving will help Tesla attain a potential $500 billion market cap. Whether that happens is up to how well Tesla does in the future. Speaking of how well Tesla does, the automaker has a little more room to breathe after it disclosed that it’s offering $650 million of common stock and $1.35 billion of convertible senior notes due 2024. The capital would add around $2.3 billion before expenses and if underwriter options are exercised. 47 elite funds owned shares of Tesla Inc. (NASDAQ:TSLA) at the end of December.
Universal Display Corporation (NASDAQ:OLED) shares are up in after hours on Thursday after the company reported GAAP EPS of $0.66 on sales of $87.76 million, up 101.4% year over year and beating by $23.17 million. CFO Sidney D. Rosenblatt said, “Looking to the year, we continue to see strong momentum in the industry. As seen by leading OEM product launches, OLEDs are the display technology of choice for premium smartphones and TVs. Additionally, one of the major themes emerging in the consumer electronics market is form factor. Driven by a robust pipeline of activity, from both panel makers and end users, we believe that the flexible, foldable display path will lead to a myriad of new products, designs and applications.” 11% of OLED shares floated are short, indicating some bearish sentiment among smart money funds.
Mercadolibre Inc (NASDAQ:MELI) shares have popped in after hours trading after the company reported GAAP EPS of $0.13 on sales of $473.77 million, beating by $0.26 and $50.13 million. Total payment volume through MercadoPago passed $5.5 billion, reaching $5.6 billion in the first quarter. Of the around 700-740 elite funds we track, 31 funds owned $1.21 billion of Mercadolibre Inc (NASDAQ:MELI) on December 31, versus 27 funds and $1.98 billion respectively on September 30.
Zix Corporation (NASDAQ:ZIXI) shares are in the green in after hours on May 2 after the company reported non-GAAP EPS of $0.07 on sales of $29.3 million. Those numbers beat the Street by $0.03 per share and $2.11 million. Sales rose 76% year over year while annual recurring revenue spiked 175%. Standalone Zix sales rose 10% and Standalone Zix annual recurring revenue rose 15%. 2.46% of Zix Corporation’s float is short, indicating that the smart money isn’t as bearish as they are some other stocks.
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