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Billionaire Marc Lasry Turned Bearish On Equities During Q3, But Loves These 5 Stocks

#3 YRC Worldwide Inc. (NASDAQ:YRCW)

– Shares Owned by Avenue Capital Group (as of September 30): 5.87 Million

– Value of Holding (as of September 30): $77.88 Million

The New York-based hedge fund firm trimmed its position in YRC Worldwide Inc. (NASDAQ:YRCW) by 1.4 million shares during the September quarter. The shares of the trucking company are 26% in the red year-to-date, but the stronger-than-expected earnings it posted for the third quarter point to the fact that the company will finally post its first annual profit since 2007. YRCW’s adjusted earnings came to $99.1 million, compared with analysts’ estimates of $81.5 million. The transportation services company was able to deliver a stronger-than-expected bottom-line even though its operating revenue decreased year-over-year by $161.4 million to $1.25 billion, thanks to its efficient pricing strategy. The company is performing quite strongly amid a slowing global economy, so analysts have even greater expectations for the company’s future performance. Meanwhile, YRCW’s stock is trading at a forward P/E ratio of 9.49, well below the 17.48 ratio for the S&P 500 benchmark. Israel Englander’s Millennium Management owns 613,102 shares of YRC Worldwide Inc. (NASDAQ:YRCW) as of September 30.

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#2 Gener8 Maritime Inc. (NYSE:GNRT)

– Shares Owned by Avenue Capital Group (as of September 30): 7.21 Million

– Value of Holding (as of September 30): $78.98 Million

Avenue Capital’s position in Gener8 Maritime Inc. (NYSE:GNRT) did not undergo any adjustments during the third quarter, accounting for 12.60% of the fund’s equity portfolio as of the end of September. The U.S-based provider of international seaborne crude oil transportation services, which completed its initial public offering of 15 million shares at $14.00 per shares at the end of June, has seen its shares decline by 27% since its IPO. The company is set to more than double its fleet capacity in the upcoming years, as it expects the delivery of 20 “eco” VLCC newbuildings equipped with fuel-efficient technology by 2017. Gener8 Maritime recently reported third quarter net income of $33.2 million, compared with a net loss of $14.3 million reported last year. It is also hard to overlook the company’s attractive trailing P/E ratio of 6.83, which might suggest that the market undervalues the company’s true potential. Howard Marks’ Oaktree Capital Management was the largest equity holder of Gener8 Maritime Inc. (NYSE:GNRT) in our database at the end of the third quarter, with 13.05 million shares.

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#1 Houghton Mifflin Harcourt Co (NASDAQ:HMHC)

– Shares Owned by Avenue Capital Group (as of September 30): 4.29 Million

– Value of Holding (as of September 30): $87.09 Million

Marc Lasry’s hedge fund firm lowered its exposure to Houghton Mifflin Harcourt Co (NASDAQ:HMHC) by 450,000 shares during the September quarter. Even so, the stock still represents his largest equity holding as of September 30, accounting for 13.90% of his fund’s equity portfolio. The shares of the global learning company are slightly over 3% in the red for the year despite delivering a strong stock performance in the first half of the year. Just recently, the company reported third quarter net sales of $575.5 million, which increased by $24.5 million relative to the same period last year. This year-over-year lift is mainly attributed to the $82.3 million contribution from the recently-acquired EdTech business, which was in turn offset by lower sales in the company’s domestic education business. Glenn J. Krevlin’s Glenhill Advisors holds a 3.26 million-share position in Houghton Mifflin Harcourt Co (NASDAQ:HMHC) as of September 30.

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Disclosure: None

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