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Rosetta Resources, BioScrip Inc, PICO Holdings Inc: Funds Bullish On These Stocks Despite Poor Performance

Ken Griffin’s Citadel Investment Group disclosed a large purchase in Rosetta Resources (NASDAQ:ROSE) this week. According to the 13G Form filed with the U.S. Securities and Exchange Commission, the hedge fund now owns 3.42 million common shares, representing 5.6% of the company’s outstanding stock. In another transaction that took place last week, Philip Hempleman’s Ardsley Partners augmented its exposure to BioScrip Inc (NASDAQ:BIOS) by 1.91 million shares. This latest move brought the firm’s holding to 3.53 million shares, which amount to 5.1% of the company’s outstanding stock. A 13D Form filed by Kelly Cardwell’s Central Square Management, revealed that fund has acquired more than 600,000 shares of PICO Holdings Inc (NASDAQ:PICO). Following this increase to its stake, the investment firm now holds 1.15 million shares of the company’s common stock.CITADEL INVESTMENT GROUP

Citadel Investment Group was founded by Ken Griffin in 1990 and today it is one of the world’s largest hedge funds. The firm has seen its assets under management grow considerably thanks to the use of a combination of advanced computer code, financial algorithms, and other technology-based methods. This has allowed the hedge fund to amass a diversified and balanced equity portfolio with a market value of $80 billion. Although even its largest holdings only account for at the most 1.5% of its portfolio, Citadel Investment Group has been aggressively purchasing shares of Newfield Exploration Co. (NYSE:NFX) as of late. The recently disclosed increase to its stake in Rosetta Resources is another large investment in an energy company.

Ardsley Partners is a Connecticut-based long/short equity fund that was founded in 1987 by Philip Hempleman. Although the firm invests on a global level, it has demonstrated a clear preference for equities belonging to chemical and chemical-related industries. Furthermore, Mr. Hempleman’s hedge fund focuses on value oriented growth stocks and currently boasts an equity portfolio value of around $758 million. According to its last 13F filing, Ardsley Partners’ top pick for the fourth quarter of 2014 was Gilead Sciences, Inc. (NASDAQ:GILD), which accounted for 9.5% of its equity portfolio.

Last week, the Connecticut-based hedge fund joined the large list of funds betting on BioScrip Inc (NASDAQ:BIOS), when it disclosed the large increase to its stake. Mario Gabelli’s GAMCO Investors is one of the major investment firms that recently acquired an important position in the company, purchasing around 5.86 million shares over the past few months. The mutual fund is currently the largest institutional investor betting on BioScrip amongst the funds we track, with a holding of 7.29 million shares. Hence, despite crumbling stock prices, which have seen shares drops 12.3% year-to-date, Ardsley Partners is not alone in its bullish stance towards the stock. And there is reason to remain optimistic, especially if the company’s trajectory up until August 2013 – when share prices reached a 10-year high – is taken into account. Furthermore, it seems BioScrip Inc (NASDAQ:BIOS) could be a great value oriented growth stock, which would fit well with the hedge fund’s investment philosophy.

Central Square Management is a long/short hedge fund that was founded in 2007 by Kelly Cardwell. The firm typically employs fundamental-based analysis, along with a bottom-up stock-picking method, when choosing which equities to invest in. The hedge fund’s equity portfolio is quite diversified and is currently valued at around $103 million.

In addition to Central Square, which held the stock as its top pick as of its last 13F filing, numerous institutional investors have been betting on PICO Holdings Inc (NASDAQ:PICO). Chuck Royce’s Royce & Associates is the largest one amongst them, with a stake of 2.59 million shares. However, not unlike the other two stocks discussed above, PICO  Holdings’ share prices have also been plummeting, losing around 19% of their value in 2014. However, Central Square has been betting on the company since the last quarter of 2013 and continues to remain bullish regarding its future.

Disclosure: None

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