Why These 5 Stocks are Losing Ground Today

The markets opened higher this morning amid hopes that a meeting of major oil producers scheduled for Sunday would result in a production freeze. Interfax, a Russian news agency, reported today that Russia and Saudi Arabia have already reached a consensus to stop production ahead of the meeting, pushing Brent to 2016 highs. However, Monday’s dismal launch of earnings season has readied investors for what could be the worst earnings season since the financial crisis. Among the stocks losing ground this morning are Spirit Realty Capital, Inc  (New) (NYSE:SRC), Horizon Pharma PLC (NASDAQ:HZNP), Och-Ziff Capital Management Group LLC (NYSE:OZM), Bank Of The Ozarks Inc (NASDAQ:OZRK), and  Micron Technology, Inc. (NASDAQ:MU). Let’s see why investors aren’t overly excited about these stocks today and how some of the best investors in the world have been trading them of late.

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Spirit Realty’s Public Offering Gets Upsized

Spirit Realty Capital, Inc  (New) (NYSE:SRC)’s stock has lost approximately 3% after the company upsized the pricing of its underwritten public offering to 30 million shares at a price of $11.15 per share on Monday, from 27 million shares. The company estimates that the overall proceeds from the offering after the deduction of expenses will amount to $320.7 million. The company plans to use the net proceeds in order to reduce the outstanding amount under its $370 million term loan facility. Shares of the company have gained over 12% in 2016 and were approaching their 52-week high, making it a prime time to make an offering.

Out of the 785 hedge funds tracked by Insider Monkey, 24 held positions in Spirit Realty Capital, Inc  (New) (NYSE:SRC) at the end of 2015 with a total value of approximately $363.9 million. Greg Poole’s Echo Street Capital Management was one of the most notable of those hedge funds, with ownership of more than 7.00 million shares of the company.

Horizon Pharma Guidance Disappoints

Horizon Pharma PLC (NASDAQ:HZNP) has plummeted by more than 20% following its announcement this morning that relayed disappointing quarterly guidance for the full 2016 fiscal year. According to the presentation, the company estimates net sales of $1.025 billion-to-$1.050 billion and adjusted EBITDA of $505 million-to- $520 million for the full fiscal year. The net sales guidance for the first quarter comes in at approximately $195 million-to-$210 million, which would represent a 79% year-over-year growth at the midpoint, but which is nonetheless well below consensus estimates of $228 million.

A total of 31 hedge funds out of those in our database held positions in Horizon Pharma PLC (NASDAQ:HZNP) at the end of the fourth quarter, with a total value of approximately $1.1 billion. Stephen Mandel’s Lone Pine Capital owned 15.00 million shares of the company on December 31.

On the next page we’ll look into three more stocks that are having a rough go of it with traders today.

Justice Department Pressuring Och-Ziff for Guilty Plea

Shares of Och-Ziff Capital Management Group LLC (NYSE:OZM) have lost more than 21% today after the Wall Street Journal reported on Monday that federal authorities are in discussions with the firm over a possible guilty plea related to a lengthy international bribery investigation. The Justice Department is looking into whether the New York-based firm knowingly bribed government officials in Libya and other African countries. The authorities are also seeking civil sanctions of approximately $400 million from Och-Ziff Capital. According to the source, Och-Ziff’s lawyers argue that the alleged illegal behavior and embezzlement was not widely known at the firm and that the activities in question were worth less than $100 million in profit.

Overall, 15 hedge funds out of those tracked by us held positions in Och-Ziff Capital Management Group LLC (NYSE:OZM). The total value of these investments is approximately $7.4 million. Crispin Odey’s Odey Asset Management Group owns approximately 4 million shares of the company.

Record Quarterly Results Not Impressing Investors

Bank Of The Ozarks Inc (NASDAQ:OZRK)’s stock has lost more than 2% today after the release of the company’s first quarter earnings report. The holding company earned a record $51.7 million in the first quarter, a 30% jump from the same quarter a year earlier, while assets jumped to $11.4 billion, up by 38% year-over-year.

“This excellent growth was achieved while adhering to our very conservative credit principles,” George Gleason, the bank’s CEO, said in a press release.

15 funds in our system held stakes in Bank Of The Ozarks Inc (NASDAQ:OZRK) with a total value of approximately $198.1 million. Among these hedge funds, John Brennan’s Sirios Capital Management had one of the largest stakes, amounting to more than 1.00 million shares of the company.

Sliding PC Sales Dent Micron

Micron Technology, Inc. (NASDAQ:MU)‘s stock has declined by more than 1% as the company continues to face high competition from market giants like Samsung. Samsung has reduced the price of its DRAM products, which has dented the profit margins of Micron. Micron reported an adjusted net loss for the second quarter of fiscal year 2016 on March 30, which led analysts to point to DRAM competition along with other factors such as the decline in the PC market and plunging mobile sector growth. It was also revealed today by Gartner that PC shipments fell by about 10% year-over-year in the first quarter. Shares of Micron are currently trading 64.91% below their 52-week high.

64 hedge funds out of those tracked by Insider Monkey held positions in Micron Technology, Inc. (NASDAQ:MU) at the end of 2015. The total value of these investments stood at approximately $1.32 billion. Peter Rathjens, Bruce Clarke and John Campbell’s Arrowstreet Capital owns more than 16.00 million shares of the company as of the end of December.

Disclosure: None