Why Are These Stocks in Spotlight on Monday?

The Dow is up by more than 200 points on the first day of the week as Brexit fears attenuate. Various polls canvassed on Friday and over the weekend showed the ‘remain’ side gaining strength over the ‘leave’ side. If Britain remains in the EU, there will be more certainty and corporate profits will be more visible.

Among the stocks trending today are Kinross Gold Corporation (USA) (NYSE:KGC), Inovio Pharmaceuticals Inc (NASDAQ:INO), Spirit Airlines Incorporated (NASDAQ:SAVE), Kellogg Company (NYSE:K), and Chesapeake Energy Corporation (NYSE:CHK). Let’s find out why traders are talking about these stocks and see what the funds in our database think about them.

While there are many metrics that investors can assess in the investment process, the hedge fund sentiment is something that is often overlooked. However, hedge funds and other institutional investors allocate significant resources while making their bets and their long-term focus makes them the perfect investors to emulate. This is supported by our research, which determined that following the small-cap stocks that hedge funds are collectively bullish on can help a smaller investor to beat the S&P 500 by around 95 basis points per month (see the details here).

Kinross Gold Falls Amid British Polls

Kinross Gold Corporation (USA) (NYSE:KGC) shares have retreated by around 3% today after several polls showed that slightly more British citizens favor remaining inside the EU than leaving for the upcoming ‘Brexit’ vote on Thursday. Before today, gold spot prices had rallied in part due to speculators buying in anticipation that a ‘Brexit’ would create a potential “black swan” event that causes an economic recession in the EU. Due to the unfavorable polls for a ‘Brexit’, that outcome is less likely and gold spot prices are now below the key 1,300 level. A total of 28 funds from our database owned shares of Kinross Gold Corporation (USA) (NYSE:KGC) at the end of the first quarter, up by six funds from the previous quarter.

Inovio Up on Early Stage Approval 

Inovio Pharmaceuticals Inc (NASDAQ:INO) received some good news today after the US FDA gave the go-ahead for the company to begin a Phase 1 trial over a potential Zika DNA vaccine. The trial will test whether the vaccine candidate, GLS-5700, offers enough safety and efficacy to move on to the next stage of trials. Inovio is working with Korean firm, GeneOne Life Science, on the study. The number of funds tracked by Insider Monkey with holdings in Inovio Pharmaceuticals Inc (NASDAQ:INO) fell by five quarter-over-quarter to six at the end of March.

On the next page, we examine Spirit Airlines Incorporated, Kellogg Company, and Chesapeake Energy Corporation.

Spirit Airlines Gets Boost From Analyst

Although crude prices may be nearing the $50 per barrel level again, Spirit Airlines Incorporated (NASDAQ:SAVE) shares are 4.7% higher this morning, courtesy of an analyst upgrade. Analysts at Credit Suisse have upgraded the stock to ‘Outperform’ from ‘Neutral’ and raised their price target to $55 per share from $44 in anticipation of stronger second-half demand. Of the 766 funds we track, 28 funds owned $262.35 million worth of Spirit Airlines Incorporated (NASDAQ:SAVE), which accounted for 7.60% of the float on March 31, versus 35 funds and $416.59 million, respectively, on December 31.

Kellogg Ventures For More Growth

Kellogg Company (NYSE:K) is in the spotlight today after the company announced it had established a venture capital fund to support growth. The fund, eighteen94, intends to invest around $100 million and will take minority stakes in companies pioneering new ingredients, foods, packaging, and enabling technology. The fund will be managed by 10-year executive at Kellogg, Simon Burton, and will hopefully increase the company’s growth rate going forward. At the end of March, 28 funds from our database were long Kellogg Company (NYSE:K), up by nine from the previous quarter.

Chesapeake Rises Despite Analyst Downgrade

Although analysts at Jefferies have resumed an ‘Underperform’ rating with a $3 price target, citing future potential shareholder dilution, Chesapeake Energy Corporation (NYSE:CHK) is more than 5% in the green today mostly due to a rally in WTI prices. Because the prospect of a ‘Brexit’ is more remote, the probability that an economic recession in Europe that reduces crude demand is lower and WTI prices are nearing the critical $50 per barrel level again. If WTI prices continue their growth, shareholders of Chesapeake will likely suffer less dilution. Among the funds we track, 31 funds were long Chesapeake Energy Corporation (NYSE:CHK) at the end of the first quarter.

Disclosure: none