Hedge Funds Are Hoarding Shares of These 5 Small-Caps

Genomic Health, Inc. (NASDAQ:GHDX) saw an increase of more than 30% in the number of hedge funds long its stock during the fourth quarter. By December 31, the 17 firms with long positions in the company owned 59.4% of its stock, valued at more than $680 million. The largest stake, by far, was the one held by Julian Baker and Felix Baker’s Baker Bros. Advisors; the position comprised 13.65 million shares, worth roughly $480 million.

On Wednesday, Genomic Health, Inc. (NASDAQ:GHDX) announced that the German Association of Gynecological Oncology had distinguished the company’s Oncotype DX® as “the only multi-gene breast cancer test with the highest 1A level of evidence,” according to a press release. Despite the good news, shares lost 3.7% on Wednesday, pulling their year-to-date losses down to more than 29%.

Next up is Loral Space & Communications Ltd. (NASDAQ:LORL), a satellite communications company that saw its stock tumble by 13.5% during the fourth quarter, which did not affect hedge fund support. On December 31, the 24 funds in our system long the stock held 57.9% of its outstanding shares, with the aggregate value of their holdings totaling just under $730 million. The largest stake among them was held by Mark Rachesky’s MHR Fund Management and comprised 8.12 million shares worth more than $330 million.

Shares of Loral Space & Communications Ltd. (NASDAQ:LORL) are down by more than 15% year-to-date, even after having recuperated more than 12% over the last month. Taking advantage of the depressed stock price, MHR Fund Management boosted its exposure further early in the first quarter, disclosing ownership of 8.35 million shares on March 7. Shares gained 7.82% on the day that this increase was made public.

Finally, there’s Avis Budget Group Inc. (NASDAQ:CAR), which remained extremely popular, although the number of funds long its stock fell by 25% over the October-to-December period. By December 31, 33 funds in our database held long stakes in the stock, with their aggregate value surpassing $2 billion. These positions accounted for 55.7% of the company’s total shares. Karthik Sarma’s SRS Investment Management held more than 9.45% of the company’s shares, 9.5 million in total.

SRS was recently displaced as the largest shareholder of Avis Budget Group Inc. (NASDAQ:CAR), however. On February 16, Fir Tree, founded by Jeffrey Tannenbaum, declared a large increase to its holding in the stock, to 10.98 million shares from 6.18 million shares. With shares down by almost 30% year-to-date, it is not only hedge funds that are buying the stock. A few days ago, Director W. Alun Cathcart purchased 20,000 shares of the company; while not huge, the move is relevant because it marks Cathcart’s first acquisition since he joined the Board in 2011.

Disclosure: Javier Hasse holds no positions in any of the securities mentioned in this article.