Tesla, Amazon, and 3 More Stocks Are Capturing the Market’s Attention Today: Here’s Why

The Dow Jones is down by 7.5 points today while the S&P 500 is barely up, as traders are caught between conflicting signals related to near-term rate hikes. Amid this backdrop, Applied Optoelectronics Inc (NASDAQ:AAOI), Calavo Growers, Inc. (NASDAQ:CVGW), and Agios Pharmaceuticals Inc (NASDAQ:AGIO) are surging, while tech giants Amazon.com, Inc. (NASDAQ:AMZN) and Tesla Motors Inc (NASDAQ:TSLA) are  slightly in the red.

In this article, we’ll take a closer look at the five stocks and use the latest 13F filings to determine how hedge funds are positioned in each.

At Insider Monkey, we track around 750 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on, can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see the details here).

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Better Guidance Issued By Applied Optoelectronics 

Applied Optoelectronics Inc (NASDAQ:AAOI) shares are 14% in the green today after the company raised its guidance for the third quarter. Due to strong data-center demand, Applied Optoelectronics anticipates adjusted EPS of $0.26-to-$0.29 for the period, well above the previous guidance range of $0.16-to-$0.21. Revenue is anticipated to clock in between $63 million and $65 million, also higher than the previous guidance of $56 million-to-$59 million. 11 funds that we track were long Applied Optoelectronics Inc (NASDAQ:AAOI) at the end of the second quarter, down by four funds from the end of the previous quarter.

Calavo Growers Rises on Earnings

Traders have bid Calavo Growers, Inc. (NASDAQ:CVGW) shares higher by 14% today after the company reported fiscal year 2016 third quarter earnings of $0.73 per share on revenue of $263.2 million, beating the consensus marks by $0.14 and $19.38 million respectively. Sales rose by 13.2% year-over-year as the company delivered double-digit sales growth in its Fresh and Renaissance Food Group segments. The company is projecting demand for avocado volume to come in at a healthy 2.4 billion pounds for 2016 and 2.7 billion pounds for 2017. Jim Simons‘ Renaissance Technologies established a new stake of slightly over 42,000 shares in Calavo Growers, Inc. (NASDAQ:CVGW) in the second quarter.

On the next page we’ll take a closer look at why Agios Pharmaceuticals, Amazon, and Tesla are making headlines.

Agios Rises on AG-221 News

Agios Pharmaceuticals Inc (NASDAQ:AGIO) has rallied by 25% after the company announced in a regulatory filing that its collaboration partner Celgene Corporation (NASDAQ:CELG) plans to file a new drug application with the FDA for enasidenib (AG-221) by the end of the year. In addition, Celgene will be giving more details on the NDA submission at a biotech conference in Boston today. AG-221 is a first-in-class, oral, selective, potent inhibitor of mutant isocitrate dehydrogenase-2 in relapsed and/or refractory acute myeloid leukemia. 11 funds in our system owned shares of Agios Pharmaceuticals Inc (NASDAQ:AGIO) at the end of the second quarter, down by five funds quarter-over-quarter.

Amazon Expands Restaurant Delivery Service

Amazon.com, Inc. (NASDAQ:AMZN) is in the spotlight today after the everything store announced that it will begin delivering food from restaurants in some parts of London. As with many of Amazon’s extra services, the “Amazon Restaurants” feature is only available for Prime customers. The cost of delivery is free if customers order more than 15 pounds or approximately $20 worth of food. With the feature, Amazon is directly challenging Uber, which recently launched its UberEATS service.

145 hedge funds in our database had a long position in Amazon.com, Inc. (NASDAQ:AMZN) as of the most recent 13F reporting period, up by 12 funds from the previous one.

Tesla in the Spotlight 

Traders are talking about Tesla Motors Inc (NASDAQ:TSLA) today after Bloomberg published an email that Elon Musk wrote to his employees last week. Among the interesting tidbits was the following:

“We are on the razor’s edge of achieving a good Q3, but it requires building and delivering every car we possibly can, while simultaneously trimming any cost that isn’t critical, at least for the next 4.5 weeks. Right now, we are tracking to be a few percentage points negative on cash flow and GAAP profitability, but this is a small number, so I’m confident that we can rally hard and push the results into positive territory.”

There is speculation that Musk is pushing hard for improved third quarter results so that the company can make an equity offering with a boosted stock. Tesla reported in an S4 filing on August 31 that it plans to raise funds by the end of the year. Tesla’s shares are down by over 15% this year and by 9% over the past month, which would likely cause shareholder consternation if an offering were to be made at such a juncture. The number of hedge funds in our system with positions in Tesla Motors Inc (NASDAQ:TSLA) fell by three quarter-over-quarter to 36 at the end of June, ranking it as the second-most popular auto manufacturer.

Disclosure: None