As we have touched on in the past, all the major indexes periodically rebalance to account for changes in stock prices and the percentage to which the stocks are allocated in the index. While the rebalancing is on different schedules for the various indexes, it can often make for a very volatile trading day. In a new research piece from Cantor Fitzgerald, the portfolio trading team highlighted the stocks expected to see the biggest number of shares changing hands on Friday’s Russell 2000 rebalancing.
We screened the Cantor list for the five stocks that will see the most buying on Friday. While the share counts may not seem high, as a percentage of daily trading volume they are more than enough to make a sizable difference. Investors looking to add these stocks may want to buy in advance. Those looking to sell may want to put in market-on-close orders.
Avanir Pharmaceuticals Inc. (NASDAQ: AVNR) is a biotech name that is up huge this year and may be poised to go higher on Friday. Cantor Fitzgerald says that 1,397,073 shares of the stock are set to be purchased by the index on the close, which is 24% of the average daily volume.
The company recently posted solid Phase 2 results evaluating the efficacy, safety and tolerability of AVP-923 for the treatment of agitation in patients suffering from Alzheimer’s disease. This could be huge for the company, which already has other drugs generating top-line revenue. The Thomson/First Call price target for the stock is $17.80. Shares closed trading on Wednesday at $12.39.
CubeSmart Inc. (NASDAQ: CUBE) is a self-managed real estate investment trust focused on self-storage facilities. The Cantor team said the stock will see a very sizable buy of 1,144,811 shares on Friday, which represents 71% of the average daily trading volume.
CubeSmart recently completed a successful 6,500,000 share secondary offering. Unit-holders are paid a 2.6% distribution. The consensus price target is $20.39, and shares closed close to that level Wednesday at $19.99.
Dana Holding Corp. (NYSE: DAN) is a global leader in the supply of highly engineered driveline, sealing and thermal-management technologies that improve the efficiency and performance of vehicles with both conventional and alternative-energy powertrains. Serving three primary markets — passenger vehicle, commercial truck and off-highway equipment — business has been solid as the economy has improved.
The stock has been hit hard since the highs printed back in the summer. The Cantor analysts expect 815,732 shares of the stock to be bought on the close Friday, which is 30% of daily trading volume. Dana shareholders are paid a 1% dividend. The consensus price target is $22.45. The stock closed Wednesday at $19.72.
Dynegy Inc. (NYSE: DYN) is a utility stock that will see some big buying on the final print on Friday. The Cantor team expects 1,453,701 shares of the stock will be purchased, representing 51% of the average daily trading volume. Dynegy’s subsidiaries produce and sell electric energy, capacity and ancillary services in key U.S. markets.
The company has three large plants producing power primarily using coal and natural gas. The consensus price target for the stock, which has indeed been troubled over the years, is $34.50. Shares closed trading on Wednesday at $28.86.
Tetraphase Pharmaceuticals Inc. (NASDAQ: TTPH) is another biotech stock that has been on fire. It may be even more so Friday as the Cantor analyst expects that 206,258 shares of the stock will be bought on the close of trading, which is 37% of daily volume. Tetraphase is a clinical-stage bio-pharmaceutical company using its proprietary chemistry technology to create novel antibiotics for serious and life-threatening multidrug-resistant bacterial infections.
Tetraphase’s lead product candidate eravacycline is being developed as a broad-spectrum intravenous and oral antibiotic, and it is being evaluated in two ongoing Phase 3 clinical trials. The consensus price target is $27, and shares closed trading on Wednesday at $24.29.
Whether you are considering buying or selling these stocks, the Russell 2000 re-balance this Friday gives what could be very good entry and exit points.