ADT, WhiteWave, and More Stocks Bought By Hedge Funds

That wasn’t all Griffin and his investment team were up to: they also reported buying shares of Fairchild Semiconductor International (NYSE:FCS) and the fund now owns 5.8 million shares after having had 3.3 million shares in its portfolio at the end of the third quarter. Fairchild’s revenue and net income fell at double-digit rates last quarter versus a year earlier, though the sell-side expects it to rebound next year. Even assuming that improvement, the stock trades at 19 times forward earnings estimates. It doesn’t seem like a good value.

GAMCO Investors filed a 13D to report a large position in Caribou Coffee Company, Inc. (NASDAQ:CBOU). Caribou is an acquisition target, with holding company Benckiser offering to buy it out for a price of about $16 per share. GAMCO seems to have been buying at prices very close to that level- even for a merger arbitrage play- and the current stock price is actually above $16. Accretive Capital Partners, a major holder of the stock, has been pushing for a higher sale price and apparently the market believes the company merits one. Here’s why hedge funds like merger arbitrage investments.

Elliott Management, which is managed by billionaire Paul Singer, was getting a little acquisitive itself: the large hedge fund reported a position in Compuware Corporation (NASDAQ:CPWR) and has offered to acquire all the outstanding shares at $11 per share (check out more stocks Elliott has been buying). As at Caribou, there is speculation the company could be bought at a higher price, and we’d note that a strategic acquirer would generally be expected to pay a higher price than a financial buyer such as Elliott. However, Compuware also seems expensive at Elliott’s offer and investors might be limited to the modest return from the hedge fund closing the deal (assuming it does so).

Related links:

Our analysis of Fairchild

See how Caribou compares to its peers

Griffin, Citadel buy shares of WhiteWave