Billionaire Lee Ainslie’s Top Small-Cap Picks ~ Radian Group Inc (RDN), Team Health Holdings LLC (TMH), SolarWinds Inc (SWI)

Team Health Holdings LLC (NYSE:TMH) comes in at number two on the list of top small-cap stock investments of Ainslie. The investment manager had 3.71 million shares of the healthcare administrative service provider valued at $217.35 million at the end of the first quarter. Team Health Holdings LLC (NYSE:TMH) has a market cap of $4.28 billion and its shares are trading at a P/E ratio of 41.88, indicating high investor expectations. The physician staffing company acquired the operations of Princeton Emergency Physicians, a staffing and management company serving 48,000 patients every year, earlier this month. Shares of Team Health Holdings LLC (NYSE:TMH) have remained mostly flat in 2015, with minimal growth of 1.65% year-to-date, though returns over the last year stand at a much stronger 18.79%. Pennant Capital Management and Millennium Management hold major stock positions in Team Health Holdings.

SolarWinds Inc (NYSE:SWI) is another top small-cap stock investment of Ainslie, who owns 2.56 million shares valued at $131.35 million. The enterprise solution company has a market cap of $3.71 billion and its shares also trade at a high P/E ratio of 47.25. As of now, SolarWinds Inc (NYSE:SWI) has received a consensus rating of “Buy” with a 1-year target price of $58.67 from analysts, which represents an upside of 21.14%. The technology company improved its cloud-based log management services with the acquisition of Papertrail in April for $41 million in cash. This acquisition indicates that the company is ready to offer management and support services for cloud applications and infrastructure. SolarWinds Inc (NYSE:SWI) has attracted investments from other large fund managers including SRS Investment Management, Lone Pine Capital, and Jim Simons‘ Renaissance Technologies.

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