Funds are buying these 3 stocks with earnings next week


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By James Dennin for Kapitall.

Next week kicks off the start of second-quarter earnings season, which is when stocks will release their numbers from the spring. Many analysts are optimistic in outlook, with the average profit expectation at a 6% gain. 

And those expectations could get even higher if Thursday's pre-Independence Day jobs report is as good as it is expected to be , especially after strong ADP payroll numbers were released this week. 

However, people are still also concerned that stocks cannot move much higher without strong earnings to support them. Careful investors will also be closely following where these earnings are coming from and what companies say about their plans moving forward.

The announcement of any new buybacks or changes to capital expenditures will help reveal how confident companies are about the next quarters and the overall strength of the economy. These insights will be closely scrutinized given the preponderance of skeptics who fear that the Fed's asset purchasing has propped up stock markets. 

We decided to run a screen comprised of stocks that  report during the first week of earnings season , starting on July 8th with Alcoa ( AA ) . This started us with a universe of about 40 stocks. We then limited that screen again by looking for companies with spikes in institutional purchasing over the last quarter . This means that the managers of pensions and hedge funds are bullish about the stock's prospects.

Do you think this will be an exciting earnings season? Use the list below to begin your analysis, and let us know what you think in the comments. 

Click on the interactive chart to view data over time. 

1. Alcoa, Inc. ( AA , Earnings , Analysts , Financials ): Engages in the production and management of aluminum, fabricated aluminum, and alumina. Market cap at $17.43B, most recent closing price at $14.80.  

Net institutional purchases in the current quarter at 64.5M shares, which represents about 5.51% of the company's float of 1.17B shares. Major Investor: Vanguard Group, Inc (The) at a 6.34% stake.

Alcoa reports earnings on Tuesday, July 8th.

2. MSC Industrial Direct Co. Inc. ( MSM , Earnings , Analysts , Financials ): Operates as a direct marketer and distributor of metalworking and maintenance, repair, and operations ( MRO ) products to industrial customers in the United States. Market cap at $5.91B, most recent closing price at $94.51.  

Net institutional purchases in the current quarter at 3.3M shares, which represents about 6.47% of the company's float of 51.03M shares. Major Investor: JP Morgan Chase & Company at a 8.40% stake.

MSC Industrial Direct reports earnings on Wednesday, July 9th

3. Synergy Resources Corporation ( SYRG , Earnings , Analysts , Financials ): Engages in the acquisition, exploitation, exploration, development, and production of oil and natural gas properties primarily located in the Wattenberg field in Denver-Julesburg Basin in northeast Colorado. Market cap at $983.37M, most recent closing price at $12.98.  

Net institutional purchases in the current quarter at 4.1M shares, which represents about 6.15% of the company's float of 66.64M shares. Major Investor: Bank of New York Mellon Corporation at a 4.74% stake.

Synergy Resources reports earnings on Wednesday, July 9th.

(List compiled by James Dennin. Monthly returns sourced from Zacks Investment Research, institutional data sourced from Fidelity. All other data sourced from Finviz.)

Kapitall Wire is a division of New Kapitall Holdings, LLC. Kapitall Generation, LLC is a wholly owned subsidiary of New Kapitall Holdings, LLC. Kapitall Wire offers free investing ideas, intended for educational information purposes only. It should not be construed as an offer to buy or sell securities, or any other product or service provided by New Kapitall Holdings, LLC, and its affiliate companies.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Stocks

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