Five Stocks in Spotlight Amid Earnings, M&A News

The US stock market opened mixed on the first day of August amid earnings and news in the M&A space.

In this way, several important stocks are on investors’ radar today, including Tesla Motors Inc (NASDAQ:TSLA), SolarCity Corp (NASDAQ:SCTY), AMC Entertainment Holdings Inc (NYSE:AMC), LyondellBasell Industries NV (NYSE:LYB), and Hewlett Packard Enterprise Co (NYSE:HPE). Let’s take a closer look at the latest activity surrounding the companies in question and see how investors tracked by Insider Monkey are positioned towards them.

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Tesla Reaches Buyout Agreement with SolarCity

Tesla Motors Inc (NASDAQ:TSLA) and SolarCity Corp (NASDAQ:SCTY) are in the spotlight today after both companies reached an agreement, under the terms of which Tesla will buy SolarCity in an all-stock deal valued at about $2.6 billion. SolarCity’s shareholders will receive 0.11 shares of Tesla for each SolarCity share, which values the latter $25.83 per share. Tesla proposed to acquire the solar company in June, but at a price between $26.50 and $28.50 per share. The combined entity will bring electric cars, home battery storage systems and solar solutions under a single brand. The merger is a part of Elon Musk’s much hyped “master plan” which focuses on providing low-carbon lifestyle solutions for customers. Amid the initial investor skepticism about the merger, SolarCity will get 45 days to consider an alternative suitor, according to the deal. Among the funds we track, 23 funds were long SolarCity Corp (NASDAQ:SCTY) at the end of March and 39 investors held shares of Tesla Motors Inc (NASDAQ:TSLA).

AMC Entertainment Misses Estimates

Shares of AMC Entertainment Holdings Inc (NYSE:AMC) have lost nearly 5% so far today on the back of the company posting worse-than-expected results for the second quarter. The Kansas-based movie theatre chain earned $0.24 a share, worse than the estimated $0.27, while revenue of $764 million missed the consensus estimate of $772.99 million. AMC said lackluster summer season affected the quarterly results. In a statement, AMC CEO, Adam Aron, said the company is hopeful to come back as box office revenues are up by 7% as of the end of July, and the theater activity is expected to remain strong in 2017. As of the end of the first quarter, 15 funds tracked by us are bullish on AMC Entertainment Holdings Inc (NYSE:AMC). Among them, billionaire Israel Englander’s Millennium Management owns 641,695 shares of the company.

On the next page, we discuss why LyondellBasell Industries and Hewlett Packard Enterprise are in the spotlight.

LyondellBasell Industries Misses Q2 Estimates

Investors are watching LyondellBasell Industries NV (NYSE:LYB) after the company reported worse-than-expected second quarter revenue amid pressure on prices and increased maintenance costs. The chemical and polymer company reported adjusted earnings of $2.45 per share, lower than the expected $2.51. Revenue in the quarter came in at $7.33 billion, down from the analysts’ consensus estimate of $7.61 billion. Volume of ethylene production in the Americas plummeted by 21% during the quarter, as the price of the chemical fell by 11% as compared to the same period of 2015. At the end of the first quarter, 54 smart money investors from our database held stakes in LyondellBasell Industries NV (NYSE:LYB).

Suitors Line up to Acquire Assets of Hewlett Packard Enterprise

Hewlett Packard Enterprise Co (NYSE:HPE)’s stock is in the spotlight amid news that several private equity firms are interested in buying some software assets of the company, according to a Reuters report on Friday. The total value of these assets is about $6 billion to $8 billion, according to people familiar with the matter. Earlier on Friday, a report published by The Information suggested that private equity firms, including KKR & Co, Apollo Global Management and Carlyle Group were considering to acquire Hewlett Packard Enterprise. The source quoted a person who had talked about the matter with representatives the firms, and said that the potential deal could be worth more than $40 billion, but Reuters’ source said that buyers are more interested in certain assets. Our data show that 51 investors owned shares of Hewlett Packard Enterprise Co (NYSE:HPE) heading into the second quarter of 2015.

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