It’s Monday and oil futures are relatively stable despite the news that the U.S. is beginning to impose sanctions on Iran again. Among the stocks making substantial waves today include Inuvo Inc. (NYSE:INUV), Clearside Biomedical Inc. (NASDAQ:CLSD), Sysco Corporation (NYSE:SYY), STMicroelectronics N.V. (NYSE:STM), and Cirrus Logic Inc. (NASDAQ:CRUS). Let’s dig deeper into why each stock moved.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey’s flagship best performing hedge funds strategy returned 17.4% year to date and outperformed the market by more than 14 percentage points this year. This strategy also outperformed the market by 3 percentage points in the fourth quarter despite the market volatility (see the details here). That’s why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
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Leading the way in terms of gainers was Inuvo Inc. (NYSE:INUV), which saw its stock soar 233% on Monday on the back of the news that ConversionPoint Technologies would buy Inuvo for $0.45 in cash per share and $1.77 in stock per share. That translates to a total consideration of around $2.22 per share, or approximately $75.5 million. The deal to buy Inuvo Inc. (NYSE:INUV) is expected to close in first quarter 2019.
Clearside Biomedical Inc. (NASDAQ:CLSD) shares sank over 60% on Monday after the company announced that its SAPPHIRE Phase 3 study of combination therapy in retinal vein occlusion did not meet its primary endpoint. According to the company, around half of patients in both arms showed a minimum of a 15 letter improvement in vision, but unfortunately there was no additional benefit for patients who took XIPERE in combination with intravitreal Eylea. Due to the results, the company will focus resources on the Uvetis program instead.
Clearside Biomedical, Inc. (NASDAQ:CLSD) shares haven’t seen a lot of action during the fourth quarter. Overall, hedge fund sentiment was unchanged. The stock was in 11 elite funds’ portfolios at the end of the second quarter of 2018. We track around 650 total elite funds.
Sysco Corporation (NYSE:SYY) shares dipped almost 10% on the first day of the trading week after the company reported an underwhelming first quarter. Adjusted earnings for the period missed by $0.01 per share, coming in at $0.91 per share, while sales missed by $180 million, with a $15.22 billion print. Although the company’s gross margin rate rose 2 basis points to 19.08%, its adjusted operating margin rate was flat, staying at 4.5%. The smart money wasn’t as bullish as before. According to our data, the number of long elite fund positions we track dropped by 7 in recent months. SYY was in 20 elite funds’ portfolios at the end of June. There were 27 top funds in our database with SYY holdings at the end of the previous quarter.
Also down on Monday were Apple suppliers STMicroelectronics N.V. (NYSE:STM) and Cirrus Logic Inc. (NASDAQ:CRUS), which each fell around 3.5% due to the news that Apple cut excess production of the iPhone XR due to weak demand. Investors were hoping that the ‘budget’ phone would stimulate more demand for iPhone supplies, something that evidently may not come true now.
STM was in 18 hedge funds’ portfolios at the end of June. There were 12 hedge funds in our database with STM positions at the end of the previous quarter. As for Cirrus, in terms of elite funds we track, the largest stake in Cirrus Logic, Inc. (NASDAQ:CRUS) was held by AQR Capital Management, which reported holding $105.7 million worth of stock at the end of June. It was followed by Renaissance Technologies with a $29.8 million position. Other investors bullish on the company included Sprott Asset Management, Nokomis Capital, and Partner Fund Management.
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