Why Sirius, Twitter, GM, Qualcomm and Plantronics Are Dragging the Market Down Today

The markets have continued to tumble today, with all major U.S stock indexes down by about 1.5%. Among the stocks driving these declines, investors can point a finger at Sirius XM Holdings Inc. (NASDAQ:SIRI), Twitter Inc (NYSE:TWTR), General Motors Company (NYSE:GM), QUALCOMM, Inc. (NASDAQ:QCOM), and Plantronics Inc (NYSE:PLT), all of which are down on Tuesday afternoon for various reasons. Let’s take a look into the events behind these drops, and at how the hedge funds in our database have been trading these stocks lately.

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Back to the stocks that interest us, we’ll start with Sirius XM Holdings Inc. (NASDAQ:SIRI), which is down by more than 2.25% in the early afternoon, even though the company reported record revenue of $1.20 billion for the fourth quarter this morning, up by 10% year-over-year. It should be noted that while revenue came in slightly ahead of expectations, earnings of $0.03 per share were just in-line with the Street’s consensus, and EBITDA of $396.2 million fell well short of the anticipated $429.3 million.

For those considering an investment in Sirius XM Holdings Inc. (NASDAQ:SIRI), knowing which hedge funds support it might come in handy. The largest institutional investor as of the end of the last fully reported quarter, the third quarter of 2015, was Peter Adam Hochfelder’s Brahman Capital, which disclosed ownership of more than 95.21 million shares of the company. Other smart money backers included Iridian Asset Management, Blue Ridge Capital, and Omega Advisors.

Next up is Twitter Inc (NYSE:TWTR), which is down by more than 9.3% today. The stock had surged by 6.55% on Monday on rumors that venture capitalist Marc Andreessen and private equity firm Silver Lake were interested in buying the company. However, according to Fortune, “Silver Lake has no interest in acquiring even a slice of Twitter.”

The news about Silver Lake’s lack of interest sent Twitter Inc (NYSE:TWTR)’s stock back down on Tuesday and then some. The shares also took a hit from yet another downgrade from Stifel Nicolaus (the second in two weeks) and some “leaked” data that has suggested that the site’s popularity is falling.

And, it seems like it is not only Mr. Market that is bearish on Twitter Inc (NYSE:TWTR). Over the third quarter, the company saw a large fall in popularity among the funds we track. As of September 30, 27 investors held long positions, versus 47 funds at the end of the previous quarter. These firms owned only 1.4% of the company’s total shares.

On the next page we will look into the news driving the declines at General Motors Company (NYSE:GM), QUALCOMM, Inc. (NASDAQ:QCOM), and Plantronics Inc (NYSE:PLT).

General Motors Company (NYSE:GM) is trading down by more than 3.1% on Tuesday afternoon, most likely pushed by the almost-flat (up by 0.5% year-over-year) U.S vehicle sales seen in January. Rival Ford Motor Company (NYSE:F) has also slumped today, by 4.60%, after reporting a year-over-year decline in January sales.

While hedge funds were looking to drive away from General Motors Company (NYSE:GM) during the third quarter of 2015, with the number of long positions falling to 88 from 104, legendary investor Warren Buffett was doing the opposite. Over the period, his holding company Berkshire Hathaway boosted its holding by 22% to 50.0 million shares, worth roughly $1.5 billion.

Another decliner on Tuesday afternoon is QUALCOMM, Inc. (NASDAQ:QCOM), down by more than 5.3%. The tumble did not seem to be prompted by any particular news, but instead looked like part of the broader decline seen in the semiconductor industry, as all major semiconductor ETFs were down in Tuesday trading. Negative news aside,Barry Rosenstein is quite optimistic regarding QUALCOMM, Inc. (NASDAQ:QCOM)’s future, having taken a large activist position in the stock. As of the end of the third quarter, his fund, JANA Partners, held 28.55 million shares of the company, worth over $1.53 billion.

Finally, there’s Plantronics Inc (NYSE:PLT), down by roughly 23.6% on Tuesday afternoon. The small-cap tech company reported its third quarter of fiscal year 2016 financial results after the market closed on Monday; while earnings came in ahead of estimates, revenue and guidance both fell short of expectations. Management also announced a restructuring plan that will include the firing of 125 employees (at a cost of $12.6 million), and the buyback of 2.0 million shares. Finally, on Tuesday morning, analysts at Raymond James issued a double downgrade on shares of Plantronics Inc (NYSE:PLT), slashing their rating to ‘Underperform’ from ‘Outperform’.

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