What Is Driving These Stock’s Growth Today?

The major US indices inched down on Wednesday amid a decline in oil prices. Nevertheless, a number of stocks are registering considerable gains on strong volumes, including One Horizon Group Inc (NASDAQ:OHGI), Sunedison Inc (NYSE:SUNE), Weight Watchers International, Inc. (NYSE:WTW),  and ArcelorMittal SA (ADR) (NYSE:MT). With this in mind, let’s take a closer look at the developments that sent these stocks higher today and see if the smart money sentiment agrees with today’s trends.

We compile the smart money sentiment based on 13F filings of around 730 investors that we follow as part of our small-cap strategy. Through extensive research, we determined that following these funds into some of the stocks that they are collectively bullish on, can help retail investors generate market-beating returns over the long run. The key is to focus on the small-cap picks, which are usually undervalued and carry significant intrinsic value. Our strategy involves imitating a portfolio of 15 most popular stocks among the funds we track and it has returned 102% since August 2012, outperforming the S&P 500 ETF (SPY) by some 53 percentage points (see more details here).

Let’s start with One Horizon Group Inc (NASDAQ:OHGI), whose stock has surged by over 24% on a very high volume. Earlier today, the company has announced that it upgraded its China mobile VoIP telco Aishuo. The upgrade allows the purchase of communication-stickers. The company also said that Aishuo has registered a considerable growth with more than 12 million downloads in the past nine months. This allowed the revenues from the segment to increase by 100% for the each of the last three quarters. However, among over 730 funds from our database, just one reported a position in the company: Ken Griffin’s Citadel Investment Group, which held 13,240 shares of One Horizon Group Inc (NASDAQ:OHGI) at the end of the September.

On the next page, we are going to discuss what has been driving the appreciation of SunEdison, Weight Watchers International and ArcelorMittal.

Sunedison Inc (NYSE:SUNE)‘s stock continues its roller-coaster ride with the shares up by around 4% today, following a 9% drop on Tuesday. In a statement issued today, SunEdison said that its subsidiary Seller Note entered into an agreement under the terms of which it will erase its outstanding principal amount of 3.75% Guaranteed Exchangeable Senior Secured Notes due 2020 worth $336 million. Noteholders will receive consideration in SunEdison membership equity interest in certain renewable energy assets under development and some class A shares of its TerraForm Power Inc (NASDAQ:TERP) yieldco. Despite the stock’s poor performance this year, Sunedison Inc (NYSE:SUNE) remained the favorite solar stock among the funds we track, with 73 funds holding long positions at the end of September, versus 93 funds a quarter earlier.

Weight Watchers International, Inc. (NYSE:WTW)‘s stock has appreciated by more than 20% so far today after the company released its first TV commercial featuring Oprah Winfrey. Earlier this year, Winfrey acquired a 10% stake in Weight Watchers International, Inc. (NYSE:WTW) and got a seat on the company’s board, in addition to the agreement to be featured in the company’s advertisements. At the end of September, 14 funds from our database held stakes in Weight Watchers International, Inc. (NYSE:WTW), amassing 7% of the company’s outstanding stock.

Finally, ArcelorMittal SA (ADR) (NYSE:MT)‘s stock has inched up by more than 2% on the back of appreciation in iron ore prices. The commodity hit a decade low around two weeks ago and has regained some 12% since then as the market is becoming more optimistic about a rebound of the iron ore prices in China. In this way, ArcelorMittal SA (ADR) (NYSE:MT)’s stock is up by some 11% since December 23, helped by a U.S. Department of Commerce decision to tax steel imports from China at 256% in order to help domestic steel producers. Among the funds tracked by Insider Monkey, 18 held shares of ArcelorMittal SA (ADR) (NYSE:MT) at the end of September, down by four over the quarter.

Disclosure: none