All the major indexes rebalance share weightings on a regular basis, as price and market cap changes dictate either buying or selling of shares at a designated time. This Friday on the close, the Russell 1000 and Russell 2000 will do their month end rebalance of shares. A new research note from the quantitative strategies team at Jefferies highlights the top buys and sells for the index scheduled for Friday.
We screened the list for the five companies that will see the highest number of shares bought on the close Friday.
Arena Pharmaceuticals Inc. (NASDAQ: ARNA) has been one of three companies in the thick of the battle for a market leading obesity drug. Shares have been extremely volatile, with huge moves on news and company data exaggerating volatility. The company can expect 1,582,056 shares to be bought. While the number seems high, Arena has averaged 8.8 million shares traded a day over the past 50 days. The Thomson/First Call price target for the stock is a whopping $7.67. Shares closed on Wednesday at $4.56.
Media General Inc. (NYSE: MEG) will have a very big day on Friday volume-wise. The company is one of the nation’s largest multimedia companies and has the industry’s largest and most diverse digital media business. Strategists expect a massive 1,845,367 shares to be bought on the close Friday. That represents almost three days of normal trading volume and could move the stock. The consensus price target is $20.75, and shares closed at $14.49.
Medical Properties Trust Inc. (NYSE: MPW) is a health care facilities real estate investment trust (REIT) that will see some gigantic buying on Friday. The Russell buyers are expected to purchase a gigantic total of 2,579,820 shares or units of the company. That represents almost one and a half days of normal volume. Unitholders are paid a very stellar 5.44% distribution, which may include return of capital. The consensus price target is $14.44, but shares closed Wednesday above that target at $15.38.
Physicians Realty Trust (NYSE: DOC) is another popular health care facilities REIT that will see a tremendous amount of buy-side action on Friday. The strategists expect a block of 1,665,057 shares to be purchased at the closing bell. That represents about one full day of normal trading volume. Unitholders are paid a very solid 5.08% distribution. The consensus price target is $17.71. Physicians Realty closed right in line with the target at $17.67.
Teekay Tankers Ltd. (NYSE: TNK) is engaged in the marine transportation of crude oil and refined petroleum products worldwide. It owns and operates crude oil and product tankers. The stock will see some sizable buying Friday, with 1,320,059 shares are expected to hit the closing tape on the buy side. Despite the large size of the buy, that only represents a little over a half day’s trading volume. Teekay investors are paid a 2% dividend. The consensus price target for the company is $6.37. Shares closed Wednesday at $5.51.
While not all these stocks could see a huge move, the stocks with the highest percentage of daily trading volume are more likely to spike. Buying any in front of Friday’s close would only be suitable for speculative-designated accounts. After all, being added to an index does not create any changes in a company’s business model.