Buyout Offers, Asset Sales, and Regulatory Scrutiny, Oh My! Why These 5 Stocks Are in the Spotlight on Monday

After opening in the red, the S&P 500, Dow Jones, and NASDAQ have each moved into the green as investors become more optimistic about the American economy. Among the stocks in the spotlight today are Yahoo! Inc. (NASDAQ:YHOO), General Motors Company (NYSE:GM), Ford Motor Company (NYSE:F), Alphabet Inc (NASDAQ:GOOGL), and Autohome Inc (ADR) (NYSE:ATHM). Let’s take a closer look at why these stocks are receiving attention and examine what top hedge funds think of each stock.

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Verizon among the top suitors for Yahoo’s core assets

With the deadline for preliminary bids for Yahoo! Inc. (NASDAQ:YHOO)‘s core assets ending tonight, the Wall Street Journal reports Verizon Communications Inc. (NYSE:VZ) is likely the top suitor for Yahoo’s operational businesses. Verizon acquired AOL last year for around $4.4 billion and could realize substantial synergies between Yahoo and AOL. Other firms in the bidding include private equity firms such as TPG, Bain Capital, and Advent International. Analysts expect the sale of Yahoo’s core assets to bring in between $4 billion and $8 billion. 84 elite funds in our system held shares of Yahoo! Inc. (NASDAQ:YHOO) at the end of December,  down from 89 funds at the end of September. Christian Leone‘s Luxor Capital Group owned 11.46 million Yahoo shares at the end of 2015.

GM and Ford get the Barron’s Lift

General Motors Company (NYSE:GM) and Ford Motor Company (NYSE:F) are beneficiaries of the Barron’s Lift today, as both stocks are 1.8% in the green in late morning trading after the financial magazine published a positive column on the two vehicle manufacturers this weekend. In the article, Barron’s writer Richard Rescigno wrote that General Motors Company (NYSE:GM) and Ford Motor Company (NYSE:F) are both cheap, with General Motors trading for just 5.6-times expected net profit for the year and Ford trading for 6.6-times 2016 earnings estimates. Rescigno notes that both companies are “leaner, nimbler, and more disciplined than they have been in decades” and pay generous dividends. Due to various factors, Rescigno thinks auto sales could be better-than-expected in the near-future, and that General Motors and Ford each have 25% upside. Warren Buffett‘s Berkshire Hathaway owned 50 million shares of General Motors on December 31, while Richard S. Pzena‘s Pzena Investment Management owned 18.29 million shares of Ford.

On the next page, we examine why Alphabet Inc and Autohome Inc are in the news today.

Alphabet receives European regulatory scrutiny

Alphabet Inc (NASDAQ:GOOGL) shares are 0.77% in the green despite the fact that EU antitrust regulators are focusing on the company’s deals with phone manufacturers involving the Android operating system. EU antitrust chief Margrethe Vestager outlined some of the issues regulators are looking at:

“Our concern is that, by requiring phone makers and operators to preload a set of Google apps, rather than letting them decide for themselves which apps to load, Google might have cut off one of the main ways that new apps can reach customers.”

Shares of Alphabet Inc (NASDAQ:GOOGL) could be higher despite the news because investors are positioning themselves for the company’s earnings release on April 21. Alphabet was the second-most widely held stock in our hedge fund database, with 154 shareholders of the company’s class A shares at the end of December along with 142 shareholders of its class C shares.

Autohome receives a non-binding going-private proposal

Autohome Inc (ADR) (NYSE:ATHM) fell by 3% today after a buyer group led by CEO James Zhi Qin offered to take the company private in a non-binding $31.50 per share offer. Given that Autohome Inc (ADR) (NYSE:ATHM)’s stock price closed at $32.15 per share on Friday, it’s unclear whether the board of directors will accept the offer unless the company’s stock price falls significantly from current levels. Hedge fund sentiment towards Autohome Inc (ADR) (NYSE:ATHM) was stable in the fourth quarter, with the number of top funds in our database that were long the stock rising by one to 13 as of the end of December.

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