Why Galena Biopharma, Whole Foods, Ocean Power Tech, Actinium Pharma & Shopify Spiked Today

Major U.S. stocks indexes are trading slightly down on Wednesday afternoon, driven by mixed economic data out of the U.S. and China, which had a particularly strong impact on telecommunications stocks, which re mostly down. Automakers are also on the decline after it was known that sales declined over May. However, a few stocks are surging today. Among them, we can count Galena Biopharma Inc (NASDAQ:GALE), Whole Foods Market, Inc. (NASDAQ:WFM), Ocean Power Technologies Inc (NASDAQ:OPTT), Actinium Pharmaceuticals Inc (NYSEMKT:ATNM) and Shopify Inc (NYSE:SHOP), all of which posted strong gains on Wednesday trading. So, let’s take a look into the events behind said spikes, and into what the hedge funds in our database think about the companies in question.

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Academic research has shown that certain insider purchases historically outperformed the market by an average of seven percentage points per year. This effect is more pronounced in small-cap stocks. Another exception is the small-cap stock picks of hedge funds. Our research has shown that imitating the 15 most popular small-cap stocks among hedge funds outperformed the market by nearly a percentage point per month between 1999 and 2012 (read more details here).

Galena’s NeuVax Gets Fast-Tracked By FDA

Let’s start with Galena Biopharma Inc (NASDAQ:GALE), a small cap that is up by more than 20%, after the company’s NeuVax (nelipepimut-S), combined with recombinant granulocyte macrophage-colony stimulating factor (GM-CSF), was designated by the FDA for Fast Track development. The drug composite will be evaluated for the treatment of “patients with early stage, node positive breast cancer with low to intermediate HER2 expression, otherwise known as HER2 1+ or 2+, following standard of care.” Galena Biopharma Inc (NASDAQ:GALE) saw the number of hedge fund supporters – among those we track – advance by 25% over the first quarter of 2016, to 5. However, these funds held slightly more than 1% of the total shares outstanding. Among the most bullish institutional investors was D. E. Shaw, which more than tripled its exposure over the quarter, to 206,943 shares.

Whole Foods Soars On Credit Suisse Upgrade

Next up is Whole Foods Market, Inc. (NASDAQ:WFM), which gained almost 5% following an upgrade from Credit Suisse. On Wednesday, the famed research firm boosted its rating on shares of the retailer from Neutral to Outperform, and its price target from $30 to $40, arguing that Whole Foods’ 365 strategy will prove beneficial over the long term. “We see a unique opportunity to own this leading specialty food player while still in the early stages of a repositioning that should reinvigorate growth. A 50 percent drop in the stock from its peak provides an attractive entry point,” the report stated. Probably helping the stock as well were Jim Cramer’s remarks on CNBC, where he also said that, he believes the 365 concept “is going to be a win.” 25 funds among those we track held long stakes in Whole Foods Market, Inc. (NASDAQ:WFM) by the end of the first quarter of 2016. A noteworthy position was that of Robert Joseph Caruso’s Select Equity Group, which more than doubled its exposure over the period, taking its holdings to almost 5.18 million shares, valued at more than $161 million by March 31.

OPTT Shares Skyrocket On New Mitsui Agreement

Shares of Ocean Power Technologies Inc (NASDAQ:OPTT) have surged by some 280% on Wednesday, after the nano cap wave power company entered into a PB3 PowerBuoy lease agreement with Mitsui Engineering and Shipbuilding (OTCMKTS:MIESF). Although the deal, valued at $975,000, may seem small, it is important because it marks the company’s first commercial agreement with Mitsui, which played an important role in the development of the PowerBuoy. Despite its very small market capitalization, Ocean Power Technologies Inc (NASDAQ:OPTT) counted on some hedge fund support as of the end of the first quarter. Two funds in our database, Jim Simons’ Renaissance Technologies and Ken Griffin’s Citadel Investment Group, were long the stock, holding 41,570 shares and 19,374 shares, respectively, as of March 31.

Actinium Announces Positive Phase 1 Results

Another stock on the rise on Wednesday afternoon is micro cap Actinium Pharmaceuticals Inc (NYSEMKT:ATNM), which gained as much as 6.8%, before settling around $1.95 – up 1.04% for the day. The surge was driven by the announcement of positive results from a Phase 1 study of the company’s Actimab-A, for the treatment of patients, over the age of 60, with newly diagnosed acute myeloid leukemia (AML). A Phase 2 trial -with revised protocol incorporating the latest findings- will start enrolling patients in the second half of the year. One of the largest stakes in Actinium among the funds we track was held by Ken Griffin’s Citadel Advisors, which last disclosed ownership of 19,717 shares. held as of the end of March.

Shopify Spikes Driven By Demandware Buyout

Finally, there’s Shopify Inc (NYSE:SHOP), which is up more than 5%, driven by news that salesforce.com, inc. (NYSE:CRM) had acquired fellow e-commerce services company Demandware Inc (NYSE:DWRE) in a deal valued at $2.8 billion, or a 56% premium to Demandware’s Tuesday closing price. The purchase of Demandware triggered speculation about a possible takeover of Shopify; in fact, back in March, it was reported that Alphabet Inc (NASDAQ:GOOGL) was considering a buyout, in its search to strengthen its Google Apps offering. Shopify Inc (NYSE:SHOP) counted on the support of 14 hedge funds in our database by the end of the first quarter. Among them was Glen Kacher’s Light Street Capital, which declared holding 1.9 million shares, valued at more than $53.5 million on March 31.

Disclosure: Javier Hasse holds no positions in any of the securities mentioned above.