Value Investor Karen Finerman Is a Buyer of Financials and Industrials: American International Group, Inc. (AIG)

Gardner Denver, Inc. (NYSE:GDI)

Metropolitan Capital Advisors purchased shares of Gardner Denver as well as GDI call options during the fourth quarter. This is Finerman’s largest new position at her hedge fund, as she purchased 24,300 shares of this industrial machinery manufacturer between October 1 and December 31.

Shares of Gardner Denver spiked from $54.75 to $66.00 during October 24-25 when the company confirmed it was exploring “strategic alternatives” and hired Goldman Sachs as its financial advisor. Readers may learn of Finerman’s position just in time, as the company is still exploring the sale of its business.

In my opinion, Finerman’s involvement indicates that she still finds the valuation to be attractive at current market prices. GDI has been in a tight trading range since the initial news in late October, and I’m willing to bet that Finerman didn’t make her purchases until after the news was announced.

On February 11, MKM Partners upgraded Gardner Denver to Buy from Neutral with an $82 price target, citing a favorable risk/reward potential ahead of the upcoming leveraged buyout. The financial media is also reported that Gardner Denver expects to receive final bids by Thursday, February 21.

Foolish Bottom Line

Karen Finerman generally maintains a buy-and-hold approach to her investments and maintains low turnover in the Metropolitan Capital portfolio. Therefore, readers can greatly benefit from studying her investment activity. The fundamental bull cases for AIG, Citigroup, and Gardner Denver remain very strong, and I recommend the purchase of all three.

Metropolitan Capital Advisors is required to disclose its March 31, 2013 holdings within 45 days after the quarter end. Visit johnmacris.com after the May 15, 2013 deadline, and I will update readers on Finerman’s activity during early 2013.

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The article Value Investor Karen Finerman Is a Buyer of Financials and Industrials originally appeared on Fool.com and is written by John Macris.

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