Why Healthways, Triumph, Sothebys, Franks International, and Tempur Sealy Are Making Thursday Moves

U.S indexes are slightly down in Thursday trading, driven by disappointing quarterly results from several U.S and European companies, as well as large declines in the U.S. Dollar and oil. However, as usual, plenty of stocks are moving in both directions on their own specific catalysts. We’ll take a look at five of them in this article, which are Healthways, Inc. (NASDAQ:HWAY), Triumph Group Inc (NYSE:TGI), Sothebys (NYSE:BID), Franks International NV (NYSE:FI), and Tempur Sealy International Inc (NYSE:TPX), and see what has traders interested in them today. We’ll also check out what the hedge funds in our database think about these companies.

At Insider Monkey, we track around 765 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see more details).

Healthways Completes Strategic Review

Let’s start with small-cap Healthways, Inc. (NASDAQ:HWAY), which has gained more than 32.8% on Thursday on roughly 25-times its average trading volume, after announcing it had completed its assessment of strategic alternatives aimed at increasing shareholder value. Among the decisions included in the review was one to sell the company’s healthy living business to its peer Sharecare Inc for $30 million in stock. This will help Healthways “refocus its efforts and investments away from its unprofitable population health division toward its growing targeted health programs business, which includes the Silver Sneakers Fitness brand, one of the country’s largest exercise programs for seniors,” a Reuters article read.

As of the end of the first quarter, 22 funds among those we track held more than 33% of Healthways, Inc. (NASDAQ:HWAY)’s outstanding shares. One of the largest stockholders was James E. Flynn’s Deerfield Management, which held 2.47 million shares of common stock worth almost $25 million, plus a bond valued at more than $70 million.

Triumph Tumbles On Revenue Miss

On the other hand, there’s Triumph Group Inc (NYSE:TGI), which has tumbled by more than 21% since the bell rang this morning, on a revenue miss. Before the market opened, the company posted first quarter EPS of $1.04, $0.01 above the Street’s consensus. However, revenue of $893.25 million, down by 6.9% year-over-year, missed expectations by $3.63 million. 17 funds in our database were long Triumph Group Inc (NYSE:TGI) at the end of March. The largest stake among them was held by Alexander Roepers’ Atlantic Investment Management, which owned more than 3.9 million shares, or almost 8% of the company’s float.

We’ll check out why Sotheby’s, Tempur Sealy, and Franks International are trending today on the next page.

Chinese Co. Discloses Activist Stake In Sothebys

Shares of Sothebys (NYSE:BID) are trading up by about 5% on Thursday after Taikang Life Insurance disclosed a 13.52% stake in the company. With slightly less than a $250 million in stock, 7.918 million shares in total, the Chinese company became the largest institutional shareholder of the company on record, displacing Dan Loeb’s Third Point, which had disclosed ownership of 6.66 million shares as of March 31. It has been reported that Taikang has already adopted an activist position, having offered some suggestions for the Board. On top of Third Point, another 21 funds in our database were long Sothebys (NYSE:BID) at the end of the first quarter. Their combined stakes accounted for almost 35% of the company’s float at the time.

Franks Falls On Frustrating Figures

Back to decliners, we’ve got Franks International NV (NYSE:FI), which has slipped by more than 17.3% today after the release of what has been described as “terrible” results. For its second quarter, the small-cap provider of engineered tubular services posted a net loss of $0.14 per share, $0.13 worse than anticipated. Its top-line performance wasn’t much better, as revenue of $120.9 million, down by 52.5% year-over-year, missed the consensus estimate by $19.1 million. In addition, management announced a halving of the stock’s quarterly dividend payment, from $0.15 per share to $0.075 per share, as demand for the company’s products continues to fall, especially offshore.

Negative news aside, Franks International NV (NYSE:FI) saw the number of funds in our database long its stock surge by 50% over the first quarter, to 15. One of the main stockholders on March 31 was D E Shaw, which held 543,209 shares of the company.

Strong Results Push Tempur Sealy Up

Finally, there’s Tempur Sealy International Inc (NYSE:TPX), which has risen by more than 15% since the bell rang this morning after reporting second quarter EPS of $0.92, a full $0.23 above the Street’s consensus estimate, on revenue of $804.4 million, which was $19 million higher than expected. 33 funds in our database held $1.21 billion worth of Tempur Sealy International Inc (NYSE:TPX) shares at the end of March. The largest institutional shareholder of record at the time was Rehan Jaffer’s H Partners Management, which owned 7.00 million shares worth about $425 million.

Disclosure: Javier Hasse holds no interest in any of the securities or entities mentioned in this article.