Typically when an index rebalances at the end of a month or the quarter, the 24/7 team looks for the top names that are expecting solid buying, so our readers can check their portfolios for names that they may want to be added to the party. This week during the rebalance data we received from Cantor Fitzgerald, we were struck by the selling of some top names. The rebalance trade is usually on a market-on-close basis, so the pricing is uniform for all the stocks. The pricing could become exaggerated at the end of the trading session.
Here are some of the names that will see some heavier than usual selling this week.
Allstate Corp. (NYSE: ALL) might be in some “selling hands” on Friday, as 1,126,223 shares are to be removed from the index. That represents 47% of the big insurer’s daily stock volume and could do a little price damage. Investors are paid a 1.95% dividend. The Thomson/First Call price target for the stock is $62.05. Allstate closed trading Wednesday at $58.18 a share.
Caterpillar Inc. (NYSE: CAT) will see a good chunk of selling as the index reduces the percentage of the stock that is held. Some 1,087,645 shares will hit sell tickets, which represents about 25% of the average daily trading volume. The company pays shareholders a respectable 2.3% dividend. The consensus price target is $111.96. Caterpillar closed trading Wednesday at $102.91.
Citrix Systems Inc. (NASDAQ: CTXS) has been a hot tech name lately, but it will see some sizable selling — 755,983 shares will be sold. That represents 23% of the daily trading volume. The consensus price target for this Wall Street favorite is $65.54. Citrix closed Wednesday at $60.86.
Corning Inc. (NYSE: GLW) is another high-profile tech name that will see a sizable number of sell orders. Expect 2,817,593 shares to hit the sell tape, and that will represent 27% of average daily trading volume for the fiber optic and glass company. Investors are paid a 1.9% dividend. The consensus price target for this aging tech stock is $21.85. Corning closed at $21.26.
3M Co. (NYSE: MMM) is another large cap name that will see some heavy selling on the rebalance, with 1,167,303 shares being sold. That represents 51% of the stock’s daily trading volume. Investors are paid a 2.4% dividend. The consensus price objective for the stock is $146.53. 3M closed Wednesday at $141.43.
Papa John’s International Inc. (NASDAQ: PZZA) will get some shares delivered to the sell desk — 109,844 are expected to be sold, Although that does seem like that many, it reflects 25% of the daily trading volume of the pizza company’s stock. Investors are paid a 1.2% dividend. The consensus price target is $53.57. Papa Johns closed at $42.42.
Sirius XM Holdings Inc. (NASDAQ: SIRI) has a huge amount of stock heading for the sell desk. A whopping 5,472,480 shares are to be sold. While that does seem like a large amount of stock to sell, it only represents 10% of the company’s huge daily trading volume. The consensus price target for the satellite radio company is $4.25. The stock closed Wednesday at $3.30.
Sometimes a rebalance can truly move a stock, and sometimes you would never know it was happening. Much can depend on other news of analysts’ comments that come out during the day. One thing is for sure, as the clock ticks down on Friday, expect to see some volume come in to the trading of these names.