Thursday’s Hottest Stocks: Tesla, Boston Scientific, J M Smucker, More

Given that ECB President Mario Drahi warned today that monetary policy cannot act alone in solving Europe’s economic problems, it’s not surprising that all three major indexes and crude futures are lower today. Among the stocks in the spotlight amidst this backdrop are J M Smucker Co (NYSE:SJM), Tesla Motors Inc (NASDAQ:TSLA), Vail Resorts, Inc. (NYSE:MTN), Boston Scientific Corporation (NYSE:BSX), and Capstead Mortgage Corporation (NYSE:CMO). Let’s take a closer look at he reasons why and use 13F filings to see how elite funds are positioned in each stock.

At Insider Monkey, we track over 765 hedge funds, whose quarterly 13F filings we analyze and determine their collective sentiment towards several thousand stocks. However, our research has shown that the best strategy is to follow hedge funds into their small-cap picks. This approach can allow monthly returns of nearly 95 basis points above the market, as we determined through extensive backtests covering the period between 1999 and 2012 (see the details here).

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J M Smucker Beats Expectations

J M Smucker Co (NYSE:SJM) is over 1% higher in the pre-market after the jam maker delivered fourth quarter of fiscal year 2016 earnings of $1.86 per share on revenue of $1.81 billion, beating the consensus estimates by $0.66 per share and $70 million respectively. Revenue soared by 24.8% year-over-year, aided by the incremental contribution from Big Heart Pet Brands. Adjusted gross margin rose by a strong 590 basis points to 37.7%, while adjusted operating margin also rose by 590 basis points to 15.5%. Fiscal year 2017 guidance was for adjusted EPS of $7.60-to-$7.75 and free cash flow of around $1 billion. Dan Loeb‘s Third Point was one of the top shareholders of J M Smucker Co (NYSE:SJM) at the end of the first quarter.

Tesla Energy Open to Samsung

Tesla Motors Inc (NASDAQ:TSLA) is in the spotlight after CEO Elon Musk told a Bloomberg reporter that Tesla sourcing batteries from Samsung SDI for Tesla’s energy unit was still possible. Mr. Musk has ruled out sourcing batteries from Samsung for the Tesla Model 3, stating that the company will maintain its relationship with Panasonic in that case. Tesla is also trending after BMW won a 100-electric vehicle leasing contract from the LAPD. The police department had previously considered Tesla’s P85D before going with BMW. Of the 766 elite funds in Insider Monkey’s database, 39 funds owned Tesla Motors Inc (NASDAQ:TSLA) at the end of March, up by ten from the end of 2015.

On the next page we examine why Vail Resorts, Boston Scientific, and Capstead Mortgage Corporation are trending today.
Vail Resorts Reports Results

Vail Resorts, Inc. (NYSE:MTN) turned in a mixed fiscal third quarter, delivering EPS of $4.23 on revenue of $647.47 million, beating bottom-line expectations by $0.03 per share but missing top-line estimates by $5.16 million. Revenue rose by 11.8% as the number of skier visits jumped by 13.9% year-over-year. Effective average ticket pricing was also up by 8.2% year-over-year. Vail Resorts expects fiscal year 2016 Resort Reported EBITDA of $448 million-to-$454 million. 30 top funds in our system owned Vail Resorts, Inc. (NYSE:MTN) at the end of the first quarter, up by seven from the previous quarter.

Boston Scientific Announces Cost Cutting Initiative

In its effort to support long-term growth and innovation and boost profits, Boston Scientific Corporation (NYSE:BSX) unveiled a restructuring program that should reduce gross annual pre-tax operating expenses by around $115 million-to-$150 million by the end of 2020. Boston Scientific will use a substantial portion of the money saved to reinvest in strategic growth initiatives. The cost of the expense reduction program is expected to amount to $175 million-to-$225 million pre-tax. Cliff Asness‘ AQR Capital Management owned more than 1.1 million shares of Boston Scientific Corporation (NYSE:BSX) as of the latest 13F reporting period.

Capstead Mortgage Trims Dividend

Capstead Mortgage Corporation (NYSE:CMO) shares are off by 2% in pre-market trading after the company declared a second quarter common dividend of $0.23 per share, down from the previous quarterly dividend payment of $0.26 per share. Although lower, the quarterly dividend still amounts to an annual yield of over 9% at current share prices. Of the 766 elite funds that we track, 15 of them owned $32.3 million of Capstead Mortgage Corporation (NYSE:CMO)’s shares on March 31, which accounted for 3.40% of the company’s float.

Disclosure: None