Hedge Funds Have Bought Altisource, Beazer Homes, and More

Page 1 of 2

Hedge funds and other major investors file a 13D or a 13G with the SEC when they acquire 5% ownership of a company or later change this position. Since these filings are made relatively quickly, they provide a more or less up-to-date recommendation that investors can research further. While the 5% threshold results in filings being made almost exclusively for small-cap and mid-cap stocks, it’s actually particularly important to see what investment teams think of these companies. Because less attention is paid to them, they are more likely to be mispriced and a given amount of research is more likely to uncover value. As a result it’s no surprise that the most popular small cap stocks among hedge funds tend to outperform the S&P 500; we have shown this by listing these stocks in our newsletter and then following their performance over the next few months (learn more about our hedge fund small cap strategy). Here are five stocks which hedge funds have bought recently:

RENAISSANCE TECHNOLOGIES

Renaissance Technologies, whose founder Jim Simons is now a multi-billionaire, reported a position of 1.2 million shares in Altisource Portfolio Solutions S.A. (NASDAQ:ASPS), giving the fund 5.3% of the total shares outstanding (see more of Renaissance’s stock picks). This was up over 20% from what Renaissance had owned at the beginning of October. Altisource is a provider of mortgage portfolio management services and has a market capitalization of $2.1 billion. Revenue and earnings were each up over 30% in the third quarter of 2012 compared to the same period in the previous year. At a trailing P/E of 21 we think that investors should take a look at it as a growth play.

Billionaire Ken Griffin’s Citadel Investment Group disclosed ownership of 1.4 million shares of homebuilder Beazer Homes USA, Inc. (NYSE:BZH). Beazer’s market capitalization is only about $420 million but on average over 1 million shares are traded per day. As a homebuilder Beazer is tied closely to the housing market and the broader economy, though even strong revenue growth has not yet pulled it into profitability; the stock’s beta is 3.4 and the most recent data has 27% of the outstanding shares held short. Find Griffin’s favorite stocks. Investors who are interested in homebuilders but find Beazer unattractive because of its losses or other factors could look at peers such as KB Home (NYSE:KBH) and Lennar Corporation (NYSE:LEN).

Read on for two more stocks that hedge funds have reported buying:

Page 1 of 2
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

The 10 Most Peaceful Countries in the World

5 Big Reasons Communism Failed

The 15 Most Famous Carl Icahn Quotes

10 Scary Animals that are Actually Harmless

The 8 Most Famous Singer-Actors in Entertainment

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!