Trending Stocks: Apple, Amazon, NXP Semiconductors, GE, and More

It’s a green day on the Street, as various M&A news and earnings announcements have improved overall market sentiment.

Among the stocks making headlines this Thursday are NXP Semiconductors NV (NASDAQ:NXPI), QUALCOMM, Inc. (NASDAQ:QCOM), Amazon.com, Inc. (NASDAQ:AMZN), Apple Inc. (NASDAQ:AAPL), and General Electric Company (NYSE:GE). Let’s analyze why each stock is trending and see how some of the world’s most successful investors have been trading these stocks recently.

We believe that imitating hedge funds and other large institutional investors can be helpful in identifying stocks capable of outperforming the broader market. Through extensive research that covered portfolios of several hundred large investors between 1999 and 2012, we determined that following the small-cap stocks that large money managers are collectively bullish on, can generate monthly returns nearly 1.0 percentage points above the market (see the details).

Frank Gaertner / Shutterstock.com

It’s official. QUALCOMM, Inc. (NASDAQ:QCOM) has agreed to buy NXP Semiconductors NV (NASDAQ:NXPI) for $110 in cash per share, good for a total value of $47 billion when including debt. Together, the two companies expect to have revenue of over $30 billion annually, and to complement each other in strategically-important areas such as mobile, automotive, IoT, and Security. Qualcomm’s management estimates that the merger will generate $500 million of annualized run-rate cost synergies within two years after the two officially combine, and be “significantly accretive” to adjusted EPS immediately upon closing. Qualcomm shares are up by just under 4% in morning trading, as investors thought the company might have to pay close to $120 per share to seal the deal. NXPI shares are also in the green in extended-market trading due to merger arbitrage traders buying.

Of the 749 hedge funds that we track which filed 13Fs for the June quarter, 57 were long NXP Semiconductors NV (NASDAQ:NXPI) at the end of June, while 48 were shareholders of QUALCOMM, Inc. (NASDAQ:QCOM).

Amazon.com, Inc. (NASDAQ:AMZN) is in the spotlight after Business Insider published a report stating that the e-commerce giant’s internal documents show that the company is planning to open as many as 2,000 compact grocery stores over the next ten years. According to the article, Amazon will initially take its time and test the market, opening just 20 stores by the end of 2018. The stores will be based in busy cities such as New York, Las Vegas, and Seattle, and will have different formats. Ten will be drive-up stores for Amazon customers to pick up the grocery purchases they made online. The other ten will sport a conventional grocery store design. Given that the grocery sector is an $800 billion-per-year market, Amazon could ramp up the number of stores it operates quickly if demand is strong. Ken Fisher‘s Fisher Asset Management inched its stake in Amazon.com, Inc. (NASDAQ:AMZN) lower by 1% in the third quarter, to 1.98 million shares at the end of September.

On the next page we’ll find out why traders are talking about Apple and General Electric this morning.

Apple Inc. (NASDAQ:AAPL) is trending after the tech giant delayed the launch of its wireless headphone product, AirPods, which was originally set to hit the market in late-October. Seeing as it’s a new product, Apple will take “a little more time” to perfect it.

“The early response to AirPods has been incredible. We don’t believe in shipping a product before it’s ready, and we need a little more time before AirPods are ready for our customers,” an Apple spokesperson said.

Given the improvements in AI and speech recognition, AirPods could be another valuable product platform for Apple that could allow it to offer more apps and services to its buyers if the reception is strong. Thus, successful uptake of the wireless headphones could make a difference in the stock in the long run. Some smart money funds weren’t too bullish on Apple during the second quarter, as our data shows the number of funds that we track which had holdings in Apple Inc. (NASDAQ:AAPL) fell by 36 quarter-over-quarter to 116 at the end of June.

Last but not least, traders are talking about General Electric Company (NYSE:GE) after the company entered into an agreement to buy 75% of Concept Laser GMBH for €549 million, or roughly $599 million. In addition, GE also raised its offer for Arcam, a European 3D printer maker, to 300 Swedish crowns per share, from the previous offer of 285 crowns. That values Arcam at 6.2 billion Swedish crowns, or roughly $696 million. The two purchases/attempted purchases are part of GE’s overall strategy of beefing up its additive manufacturing operations, which could grow substantially over the decades to come. 57 funds in our database had a long position in General Electric Company (NYSE:GE) at the end of June, down by seven funds from the end of March.

Disclosure: None