Hedge Funds Lay Out Bullish Cases for Tyson Foods, Credit Acceptance Corp, and More

In its third quarter letter, GreenWood Investors mentioned that it is bullish on Fiat Chrysler Automobiles NV (NYSE:FCAU) for valuation reasons. Specifically, the fund thinks that Fiat-Chrysler is trading for a valuation that only makes sense if the U.S. unemployment rate rises above 12%, which currently doesn’t look likely at all. If the U.S. economy doesn’t crash and Fiat Chrysler Automobiles NV (NYSE:FCAU) meanwhile were to spin off Magneti Marelli, the stock could potentially rise. Using GM’s valuation, the fund estimates that a fair value for the stock should be 7.80-10.11 euros per share, or $8.57-$11.11 per share.

Although many in the market don’t see many meaningful upside catalysts over the next two years for MEI Pharma Inc (NASDAQ:MEIP), GreenWood is nevertheless bullish on the name. Because MEI Pharma Inc (NASDAQ:MEIP) offloaded the exclusive worldwide rights of its Leukemia drug to its partner, Helsinn, GreenWood reckons MEI’s downside is lower due to the associated cash, equity injection, and the potential for a robust royalty stream and milestone payments if the drug were approved. GreenWood is willing to wait.

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