5 Key Moves Made By This Chicago-Based Hedge Fund Last Quarter: Analogic Corporation (ALOG), MYR Group Inc (MYRG)

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Korn/Ferry International, meanwhile, has seen a generally bullish human resources industry boost its prospects. The company’s primary focus is on talent management services through executive recruitment programs, for example, and its shares are already up 8.3% since the start of 2013. Like MYR Group, the sell-side expects EPS growth to speed up rapidly over the next few years, and shares of Korn/Ferry still trade at discounted earnings and book value multiples (by double-digits, in percentage terms).  There’s no income here, but ‘growth at a reasonable price’ oriented investors might not be able to find a better play in this particular niche.

In the same ballpark we have WMS Industries Inc. (NYSE: WMS), which was a new position for SG Capital in the fourth quarter. According to the hedge fund’s filing with the SEC, the casino and gaming company is now the largest position in its 13F portfolio, worth close to 7.1% of its total holdings. This is the highest conviction bet we have on record for SG Capital, and it’s worth noting that WMS Industries was originally held by the fund in the second quarter of last year before the position was closed out in Q3.

The primary thesis supporting WMS Industries is its broad exposure to the domestic gambling industry, from Illinois to Las Vegas. The company is optimistic about its next-gen gaming cabinets, and the sell-side expects EPS growth near 20% next year. This forecast is far above WMS’s historical average (6.0%) over the past half-decade, and shares aren’t particularly expensive at 1.5 times book and 19.8 times forward earnings. One potential cause for concern is this stock’s percentage of float that’s short—about 11.9%—and investors should watch this indicator closely.

Joining SG Capital in WMS Industries is Ken Griffin, Chuck Royce, and Joel Greenblatt (check out Joel Greenblatt’s favorite stock picks), so there’s clear support from the smart money here.

Disclosure: I have no positions in any of the stocks mentioned above

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