Regis, KB Home, and More Stocks Hedge Funds are Buying

Page 1 of 2

CITADEL INVESTMENT GROUP13F filings provide the most complete picture of hedge fund portfolios, and they are certainly worth keeping track of, but they are limited in that they are only released once a quarter, and six to seven weeks after the end of the quarter at that. More up-to-date information comes in 13D and 13G filings, which are made when a fund or other major investor owns 5% or more of a stock’s shares outstanding. The catch is that these restrictions generally mean that filings are limited to small cap and mid cap stocks; however, these tend to be the exact stocks that are less well known and where it can be particularly useful for hedge funds to identify picks that are worthy of further research. Here are five stocks hedge funds have been buying recently:

Starboard Value, which is managed by Jeffrey Smith, increased its holdings of Regis Corporation (NYSE:RGS) to a total of 4.2 million shares. The operator and franchisor of hair salons had already been one of Starboard’s five largest holdings by market value at the beginning of October (find more of Starboard’s favorite stocks). The fund now owns about 7% of the company’s outstanding shares. Regis trades at 21 times forward earnings estimates, and in its most recent quarter revenue was actually down compared to the same period in the previous year; operating income was about flat. In addition, while Starboard appears optimistic there is considerable short interest suggesting that a number of traders consider Regis overvalued. We don’t think that it’s a good buy. See more of our analysis of Regis.

Billionaire Ken Griffin’s Citadel Investment Group reported owning 5.4 million shares of homebuilder KB Home (NYSE:KBH). Read about Citadel’s investment in KB Home. The company grew its revenue 19% in its last fiscal year (which ended in November 2012) compared to the previous one; the bottom line also improved, though KB Home remained unprofitable. Given its losses, there would have to be continued improvement in the housing market for KB Home to look anything like a value stock and it might be better to consider peers such as Lennar Corporation (NYSE:LEN) and D.R. Horton, Inc. (NYSE:DHI).

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

Cheapest Cities to Visit in the US

Most Expensive Summer Camps

Most Expensive Animals in the World

Most Expensive Specialty Crops in the World

Movies That Took Ages to Make

The Longest Hollywood Films Ever Made

Most Expensive Concert Stages

The Richest Bands of all Time

10 Most Corrupt Countries 2013 List

10 Countries with the Highest Quality of Life Index

Most Expensive Mattresses in the World

5 Smallest Countries by Land Area

The Ultimate Heartbreak Songs

Richest Teenagers in the World

10 Most Haunted Places in America

10 Best Places to Retire in Florida East Coast

Top 10 Places to See Before You Die

Top 8 Countries in the World Where Justice Prevails

10 Richest States in America

15 Wealthiest Countries in the World

Richest Singers in the World

Most Expensive Tasting Menu in New York City

Most Expensive Baby Items in the World

Most Expensive Hotel Suites in Vegas

Most Expensive Brunch in New York City

Most Expensive Beef Cuts in the World

25 Best Colleges to Get a Job

Top 10 US Supermarkets

The 25 Most Dangerous Cities in the World to Visit

Most Expensive Xbox Games

Top 11 Cities Where Billionaires Live

Top 10 Most Charitable Companies in America

Most Expensive Seafood in the World

The 10 Wildest Conspiracy Theories

The 10 Best Job Markets in the US

Top 10 Accounting Scandals of All Time

The 25 Biggest Cities in the World

Top 10 Best Paying Virtual Jobs

Most Expensive Leather Shoes in the World

Top 6 Things to Buy in March

The 10 Most Stressful Jobs in America – 2014 List

Top 10 Jobs for Introverted People

Top 10 Honeymoon Destinations in the World

Top 10 Highest Paying Jobs in the World

Most Expensive Day-Care in New York City

The 10 Cheapest Places to Retire Abroad

Top 10 Most Expensive Luxury Cars in the World – 2014

Killer Small Business Ideas

The 50 Best Personal Finance Blogs

Most Expensive Apartments in New York City

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!