Billionaire Steve Cohen Bought Medical Device Stock ArthroCare

Page 1 of 2

SAC CAPITAL ADVISORSSAC Capital Advisors isn’t going to let the current speculation and investigation into insider trading by past employees of the fund interfere with its investing activities. A recent 13G filed with the SEC shows that the fund, which is managed by billionaire Steven Cohen, owns 1.6 million shares of medical device company ArthroCare Corporation (NASDAQ:ARTC). This gives it 5.6% of the shares outstanding. ArthroCare is best known for products which help treat orthopedic and soft tissue conditions. SAC had owned about 400,000 shares of the company at the beginning of October, and that had been an increase of 250% from the size of its position at the end of June (check out more of Cohen’s stock picks and read our latest report on the insider trading probe). As such this seems to have been a fairly recent buy by Cohen and his team, and with the stock about flat since the end of September investors have the opportunity to buy in at a similar price.

ArthroCare Corporation has a market capitalization of a little over $900 million; it averages about 140,000 shares traded daily, and has a current market price of about $33 per share, giving it close to $5 million in average daily dollar volume. The company’s most recent 10-Q showed a small increase in product sales compared to the third quarter of 2011. Because ArthroCare did not report as much in exit, investigation, and restatement costs, earnings were up substantially from a year ago. However, for the fuller year, income seems to be more steady and it looks to us like the company merely had a number of one-time charges in Q3 2011- there hasn’t been much actual growth. A little over two-thirds of the company’s business comes from the United States. At the current stock price, ArthroCare trades at 22 times forward earnings estimates. This is a valuation at which we’d expect to see substantial growth in the company’s business.

Healthcor Management, a healthcare-focused hedge fund managed by two former SAC employees (Arthur Cohen and Joseph Healey), reported owning nearly 2 million shares of ArthroCare Corporation at the end of September, making the stock one of the fund’s ten largest holdings by market value (see what other healthcare stocks they thought were good investments). Healthcor had been increasing its stake in the company earlier this year. Renaissance Technologies, whose founder Jim Simons is now a multi-billionaire thanks to the fund’s success, had reported owning about 400,000 shares though this had been a 15% decrease from three months earlier (find more stocks that Renaissance was trading).

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

6 Ways to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

10 High Paying Seasonal Jobs in America this Holiday Season

The 10 Busiest Shipping Lanes in the World

5 Most Valuable Brands in China

The 10 States with Highest Substance Abuse Rates Crippling Their Populace

The Top 10 Things to Do Before You Die That Will Echo for Eternity

The 10 Best Selling Items on Etsy

Top 10 Things to Do in Tokyo, the Greatest City in the World

10 Mistakes on Social Media that Can Harm You and Will Probably Get You Canned

The 10 Best Cities to Find Jobs in 2014

The 10 Most Controversial Songs Of All Time to Hit (and get Banned from) the Airwaves

The 20 Biggest IPOs in US History

The 10 Best Places to Visit in Mexico that Are Beautiful and Safe

7 Bad Habits that Age You Beyond Your Years

The 40 Best Fortune Cookie Sayings That Will Leave You Bemused, Befuddled, or Beguiled

10 Foods to Eat Before a Workout to Make Every Drop of Sweat Count

The 5 Best Documentaries On Netflix You Must See

The Most Heartwarming and Inspirational Story Of This Halloween Season, It Will Make You Cry and Jump For Joy

10 Best Party Songs of All Time to Bring the House Down With

5 New World Order Conspiracy Theories that Will Strangle the World

The 10 Highest Rated Movies of 2014

The 10 Largest Container Shipping Companies in the World

The 10 Largest Armies in the World: Who Should We Be Afraid Of?

Best Warren Buffett Quotes on Money You Need to Hear

The 10 Highest Suicide Rates by Profession

The 20 Most Underrated Movies of All Time

The 10 Fastest Growing Companies in America

The 10 Biggest Outlet Malls in USA

The 5 Most Popular Rap Songs of All Time

The 10 Countries that Eat the Most Meat

The10 Most Expensive Countries to Fly To

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!