Level 3 Communications, Inc. (LVLT), Alpha Natural Resources, Inc. (ANR): It’s Time You Should Start Paying Attention to This Hedge Fund

Steelhead Partners’ third-favorite stock, Alpha Natural Resources, Inc. (NYSE:ANR), composes 6.74% of the portfolio. The steam and metallurgical coal company has increased sales by 31.03% over the past five years. Although the price of the stock is down by nearly 50% over the past year, its shares have increased in value by 19.85% over the past six months, up 55% from the 52-week low. A low P/B (0.36) and strong earnings per share growth predicted next year (41.3%) are reasons Mr. Johnston is attracted to the stock, although the investor’s passion for Alpha Natural Resources, Inc. (NYSE:ANR) may be cooling, as Steelhead recently decreased their position in the stock by 6%.

Coal, communications, and forest products, then, account for nearly 30% of the Steelhead Partners’ portfolio. Looking at the merits of these three stocks from across the spectrum in comparison with one another, Resolute Forest Products is the strongest equity, both in terms of the numbers mentioned and the company’s push towards sustainability.

It’s worth noting, as well, when considering investment options that of the top 10 holdings in the Steelhead Partners 13F portfolio, only three are long positions in equities. Of the top ten, then, these aren’t just Michael Johnston’s favorite stocks—they are his only ones, which raises all three boats a bit. Learn more about why you should pay attention to the smart money.

Disclosure: none