Editor’s Note: Related Tickers: Workday Inc (NYSE:WDAY), Post Holdings Inc (NYSE:POST), Infinity Pharmaceuticals Inc. (NASDAQ:INFI), Ultratech, Inc. (NASDAQ:UTEK), InterMune Inc (NASDAQ:ITMN)
The most comprehensive picture of what hedge funds are doing comes in the form of quarterly 13F filings, and we have shown that this information can be used to develop profitable investing strategies. For example, the most popular small cap stocks among hedge funds earn an average excess return of 18 percentage points per year (learn more about our small cap strategy). However, some investors prefer more up to date information about what funds are doing and a small piece of their movements can be tracked through 13D and 13G filings, which are published with the SEC after a fund buys over 5% of the outstanding shares of a stock or makes significant changes to that position. Investors can then do further research on any interesting names out of these initial ideas. Here are five stocks that hedge funds have bought recently:
Lone Pine Capital, which is managed by billionaire and Tiger Cub Stephen Mandel, has increased its stake in Workday Inc (NYSE:WDAY) to a total of 3.5 million shares or 9% of the company. See Mandel’s stock picks. This was up from just under 1 million shares at the beginning of January. Workday has been seeing large increases in revenue, but operating losses have increased as well. There has been something of an improvement in operating margins, but even according to Wall Street analysts the company is a long way away from profitability- losses per share are supposed to be about even between this fiscal year and the next one.
Billionaire Steve Cohen’s SAC Capital Advisors had owned a small number of shares in Infinity Pharmaceuticals Inc. (NASDAQ:INFI) in its last 13F but increased its holdings to 2.4 million shares per a recent 13G filing. Find Cohen’s favorite stocks. The development stage biotechnology company used $80 million in cash on its operations in 2012; at the end of the year it had over $300 million in cash, cash equivalents, and marketable securities on its balance sheet. The stock is up over 200% in the last year on optimism concerning Infinity Pharmaceuticals Inc. (NASDAQ:INFI)’s drug trials, though we do not particularly like development stage companies.
Adage Capital Management, run by former Harvard Management employees Phil Gross and Robert Atchinson, added shares of $800 million market cap semiconductor manufacturing equipment company Ultratech, Inc. (NASDAQ:UTEK). On average over 300,000 shares are traded per day so at a market price above $30 there is plenty of dollar volume for most investors. Ultratech grew both its revenue and its earnings per share in the first quarter of 2013 versus a year earlier, though the company did miss expectations on both fronts. The stock currently trades at 17 times trailing earnings.
Jacob Gottlieb’s Visium Asset Management, which tends to invest over half the capital it reports on 13Fs in healthcare stocks, disclosed ownership of 5.4 million shares of InterMune Inc (NASDAQ:ITMN), or close to 7% of the total shares outstanding. Check out more stocks Visium owns. Intermune’s products are designed to treat idiopathic pulmonary fibrosis, though it too is a development stage company and analysts do not expect it to earn a profit either this year or next year (consensus is for losses of $1.89 per share in 2014). We would note that the stock is a popular short target.
Disclosure: I own no shares of any stocks mentioned in this article.
