Hedge Funds Are Buying Herbalife Ltd. (HLF) and These Other Stocks

A 13D filed with the SEC has Carlson Capital, a hedge fund managed by Clint Carlson, owning 8 million shares of EnergySolutions, Inc. (NYSE:ES), up from 2.3 million shares at the end of September. Find more stocks Carlson owned. EnergySolutions is a waste management company focused on decontamination and decommissioning of nuclear facilities as well as remediation for areas affected by hazardous or nuclear waste. It has a market capitalization of about $340 million (with over 1 million shares traded daily), representing 11 times consensus earnings for 2013. The company is unprofitable on a trailing basis due to a poor Q4 2011; good results are expected for the same period in 2012 which would leave EnergySolutions profitable for the year.

James Flynn’s Deerfield Management (research stocks that Deerfield likes) has a position of 7.9 million shares in Dendreon Corporation (NASDAQ:DNDN), a biotech company whose primary product is cancer treatment Provenge. Dendreon is down 84% in the last two years as sales of Provenge have disappointed and the company has been reporting large losses. Sell-side expectations are that it will be unprofitable next year as well. There is heavy short interest in Dendreon, and with potential cash concerns in the next few years we don’t think that it’s a good buy.

Disclosure: I do not own shares in any stock mentioned in this article.