West Corp (WSTC), Credit Acceptance Corp. (CACC), Syntel, Inc. (SYNT): Professor Roger Ibbotson’s Small-cap Picks

Zebra Capital Management held a total of 17,511 shares of Credit Acceptance Corp. (NASDAQ:CACC) valued at $3.42 million at the end of the first quarter. This represented a reduction in the fund’s stake in the company, with its share count down from 26,357, though the value of the position declined only slightly, to $3.60 million. The latter is due to the strong performance of the stock during the first quarter, as it returned a hefty 42.95%, which may have prompted Ibbotson to take some profit from the holding. The company reported robust earnings per share of $3.44 on revenue of $194.20 million during the first quarter. Analysts expect Credit Acceptance Corp. (NASDAQ:CACC) to perform very well in the next three quarters of the year as well, giving the stock a consensus estimate of $14.25 in earnings per share for fiscal year 2015, while analysts at JMP Securities, Jefferies Group, and Compass Point all raised their price targets on the stock recently. The financial services company was held in the equity portfolios of 20 hedge funds in our database, with their investment amounting to $385.48 million. A few of those funds are Bloombergsen, Goodnow Investment Group, and Quincy Lee‘s Teton Capital.

Zebra Capital Management held a total of 42,239 shares of Syntel, Inc. (NASDAQ:SYNT) worth $2.19 million at the end of March. The technology company recently reported its results for the first quarter, posting $0.48 in earnings per share on revenue of $220.60 million, which was 6% lower than its performance in the last quarter of 2014, but up 1% compared to the same quarter of last year. The company’s earnings per share fell well short of Thomson Reuters’ forecast of $0.67. Syntel, Inc. (NASDAQ:SYNT) was expected to post $2.74 in earnings per share for fiscal year 2015, which may now be in jeopardy given its underwhelming first quarter results. The stock has been given a one-year consensus price target of $51.43, suggesting limited upside of about 5.5% over the next year. In addition, Zacks recently downgraded Syntel, Inc. (NASDAQ:SYNT) to “Neutral” from “Outperform”, though its price target of $53.30 is slightly higher than the consensus.  Other funds that have invested in the company besides Zebra Capital Management include Martin Whitman’s Third Avenue Management and Jim Simons‘ Renaissance Technologies, which increased its stake in the company during the first quarter.

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