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SAC owns a huge chunk of these companies. Should you be selling them?

Talking Numbers

The government’s noose is tightening around the neck of billionaire Steve Cohen’s SAC Capital hedge fund. We look at companies SAC owns a huge chunk of and one name in particular.

The government’s noose is tightening around the neck of billionaire Steve Cohen’s SAC Capital hedge fund.

Last week, a New York grand jury hit the fund with a five-count indictment, including securities fraud. The fund is alleged to have engaged in illegal activities between 1999 and 2010. SAC Capital has pleaded not guilty, saying it was only “handful of men” at the company involved, though it did not specify how much a handful of men are.

(Related: SAC Capital pleads not guilty to all charges in court)

Among other things, prosecutors are seeking “any and all assets” from SAC. And, yes, a lot of those assets include stocks. Cohen’s fund owns shares in a lot of big names such as Amazon and Visa, but it controls only a tiny fraction of those companies. However, SAC does have a larger percentage of smaller companies. As reported by CNBC, these include:

Stocks with big SAC positions
% shares outstanding
Clearwater Paper (CLW) 7.4%
Forest Oil (FST) 7.3%
LogMeIn (LOGM) 6.9%
Repros (RPRX) 6.8%
Stage Stores (SSI) 5.9%
Walter Energy (WLT) 5.4%
Tivo (TIVO) 5.3%
Colony Financial (CLNY) 5.2%
Visteon (VC) 5.2%
Celldex (CLDX) 4.9%

Of all these stocks, one stands out to John Stephenson, portfolio manager at First Asset Investment Management. He believes commercial real estate financial company Colony Financial has more upside potential.

“I think this is an awesome name,” says Stephenson. “I absolutely love this company. I mean, this thing is a cash flow machine.”

[Disclosure: Stephenson and First Asset both own shares of Colony Financial.]

On the opposite side of this trade is Abigail Doolittle, Technical Strategist at The Seaport Group. “I would steer clear here of Colony Financial,” says Doolittle, who believes the charts are pointing the stock price down by as much as 35%.

Which side is correct? Watch the video above to see Stephenson and Doolittle debate on Colony Financial and decide for yourself.


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