Special-Situations Hedge Fund Harbinger Capital Partners has taken a stake in Owens Corning (OC).
Since late April, Harbinger has spent $57.46 million purchasing 2.6 million (almost 2%) shares of Owens Corning on the open market at prices ranging from $20.56 to $23.96 each.
The most recent transaction was early this week as they purchased 479,790 shares for $11.5 million, according to a SEC filing late Wednesday.
Harbinger’s Website says they invest in:
Restructuring/Bankruptcy
Purchase securities at a price that values the underlying investment at attractive valuations to private and public market multiples.
Turnaround
Purchase securities at a depressed price with the expectation that the business has bottomed or can be restructured out of court. Receive coupon payments and expect price appreciation to the intrinsic value of the enterprise.
Liquidation
Purchase securities at a price which is materially below our assessment of the asset values.
Event Driven
Purchase securities based on a quantitative analysis of the value of the underlying securities, timing and probability of a specific event such as an exchange offer, emergence from or announcement of bankruptcy, earnings announcement, or outcome of creditor negotiations.
Capital Structure Arbitrage
Simultaneous purchase and short sale of two or more securities of the same issuer in order to take advantage of perceived mis-pricings between an issuer’s securities or in anticipation of an event that will cause the pricing differential to narrow.
Short Sale
Sell short securities when a company’s deterioration or industry fundamentals are not reflected in current price.
Special Situations
Identify medium to long-term investments with a primarily long bias, with flexibility to use other investment strategies and types of securities when attractive opportunities arise.
Owens fits in to a few of the categories. The simple truth is that currently it is a wind energy and hurricane play. Nothing sells a whole bunch of roofing shingles like a hurricane of even minor intensity and Owens, currently a huge producer of the composite material used in wind turbines for wind energy can barely keep up with demand for the product. This is the reason they recently reiterated full year results despite the current housing calamity.
Disclosure (“none” means no position):Long OC
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