By Max Magee
When researching stocks, it can be pretty common to wonder what your fellow investors are up to. It's not always a great idea to follow the crowd when investing in equities, but peeking into the activity of other investors may reveal fresh names for consideration, and new story ines that may not have been on the radar.
The stocks we'll consider today, for example, include recent IPOs, a private equity firm, a thinly traded chemicals stock, and a household brand name that's been on a tear.
To compile our list, we'll look at the aggregated recent activity of our member watchlists and portfolios. Our "most added" metric measures how quickly stocks are being added to member portfolios in relation to the expected rate based on historical trends. A value greater than one indicates a greater than normal number of adds over the last seven days, and a value less than one indicates a less than normal number of adds.
We'll limit our search to stocks with a market cap above $500 million to weed out penny stocks and micro caps. The full list is available here (please note that this list updates regularly, so new names may replace those discussed below).
Arcos Dorados Holdings (NYSE: ARCO) and CVR Partners (NYSE: UAN) are recent IPOs in two very different industries that have jumped out from the recent bumper crop of IPOs to draw the most investor interest. In many ways, these firms are in "boring" segments. Arcos, operating primarily in Latin America, is the world's largest McDonald's (NYSE: MCD) franchisee. Arcos, based in Argentina, is a member of the Argentina Stocks and ADRs, a group that has lagged badly over the last month. (only the South Africa Stocks and ADRs Index has fared worse across 22 international Indexes.) Arcos has been added to tickerspy portfolios at 54.4x the expected rate over the last seven days.
Meanwhile, CVR is a fertilizer MLP spun off from CVR Energy (NYSE: CVI) that is boasting an expected yield of 14.8%. This compares very favorably with the MLPs Index, where the current average yield is 6.1%. CVR has been added to tickerspy portfolios at 42.3x the expected rate over the last seven days.
KKR & Co (NYSE: KKR) is a well-known name in the private equity world and the stock has been strong of late, up about 25% so far in 2011, a performance that no doubt helps account for the investor interest. But what really had investors adding it to watchlists last week was likely a mention by CNBC guru Jim Cramer, who in response to a viewer question about American Capital (NASDAQ: ACAS) said "Too risky for me. I don't know what they own. I'm going to send you to Kohlberg Kravis Roberts."
The firm also reported earnings last week that beat analyst estimates by a wide margin. Clearly, private equity is seeing a more favorable environment in which to generate big returns, and so the sector may be worth watching. KKR has been added to tickerspy portfolios at 29.1x the expected rate over the last seven days.
Sparsely followed NL Industries (NYSE: NL), which makes pigments and components for locks, furniture and gauges is the mystery on this list. The stock spiked 12% on no news on May 2 and was able to hold the gains after reporting earnings on May 4. The stock has been on the move, up 61% so far this year. According to its website, NL owns "a significant interest" in Kronos Worldwide (NYSE: KRO), another stock on the move, and that may account for NL's strength. NL has been added to tickerspy portfolios at 22x the expected rate over the last seven days.
Finally, a better known name attracting a lot of investor interest is weight loss products firm Weight Watchers Intl (NYSE: WTW), which is up an incredible 144% this year. Blowout earnings in February sent the stock sharply higher. The stock dipped on a new earnings report last week, but rebounded sharply after Wall Street digested the numbers. On Monday, Wedbush raised estimates on the name, citing the successful launch of the new Weight Watchers PointsPlus program.
Weight Watchers' strength has helped push the Fitness and Dieting Stocks Index higher, and the Index was charging ahead again yesterday following a strong earnings report from Medifast (NYSE: MED). Weight Watchers has been added to tickerspy portfolios at 20x the expected rate over the last seven days.