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Tourbillon Capital Partners Ignores Analyst Ratings and Enters New Position in Green Plains Inc (GPRE)

Jason Karp’s Tourbillon Capital Partners entered a new position in Green Plains Inc (NASDAQ:GPRE) with 3,841,000 shares. According to the 13G filing, the hedge fund now holds Common Shares representing 10.2% of the company’s outstanding stock. Although the stock was downgraded to a neutral rating by various analysts, Tourbillon Capital Partners proceeded with the transaction in an interesting display of optimism.

Jason Karp - Tourbillon Capital Partners

Tourbillon Capital Partners is a long-short equity hedge fund, founded in 2012 by Jason Karp. Despite having a short history, the firm already boasts a highly diversified equity portfolio valued at around $2.7 billion, which has been growing at an accelerated pace. The hedge fund has successfully implemented a top-down and bottom-up stock picking strategy, combined with fundamental analysis, derived from in-house and external research. Since Tourbillon Capital Partners acquired a new position in Green Plains Inc (NASDAQ:GPRE) at a time when analysts displayed skepticism regarding the stock, it is reasonable to suggest its research produce other results. Considering the fund’s long-term investment strategy and “buy” recommendations made by other analysts a few weeks back, the purchase of Green Plains stock could prove to be a smart move. After all, the company is suffering from declining share prices largely due to the overall poor performance of the energy sector. Judging by their strong earnings and in anticipation of a reversal of the current industry-wide trend, Green Plains stock could end up performing quite well.

Green Plains Inc (NASDAQ:GPRE) is a producer of ethanol and co-products, which is markets and distributes in the United States. In addition to offering storage services, the company buys and sells bulk grain to processing companies and livestock manufacturers. Furthermore, Green Plains trades in ethanol, corn oil, natural gas, and other commodities, distributes biodiesel, and provides trading advisory services. The Nebraska-based ethanol manufacturer was founded in 2004 and was previously known as Green Plains Renewable Energy Inc. When share prices soared last year, reaching a 52-week high of $46.28, numerous investors were drawn to the company. However, in recent months the stock has plummeted, despite the optimism displayed previously by hedge funds and shareholders.

The new position acquired by Tourbillon Capital Partners has turned the hedge fund into Green Plains Inc (NASDAQ:GPRE)’s largest institutional shareholder. Nevertheless, it is not the only investment firm betting on the company. Despite reducing its exposure last quarter,  Jason Capello’s Merchants’ Gate Capital holds 1,958,926 shares, which account for 5.77% of its equity portfolio. Louis Navellier’s Navellier & Associates on the other hand maintained its stake in the company, which amounts to 946,636 shares, throughout the past quarter despite the stock’s declining price.

Disclosure: Pablo Erbar holds no positions in any stocks or funds mentioned.

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