The Stocks the Funds Are Buying

We all know which stocks have made Wall Street's Buy List. What I want to know -- and I'm guessing you do, too -- is who's doing the buying. Which funds are buying Wall Street's most popular stocks, and how does their judgment compare with that of our Motley Fool CAPS community?

Here's our latest group of contenders:

Company

Latest Closing Price

CAPS Rating (out of 5)

Astronics (Nasdaq: ATRO  )

$23.85

*****

TransAct Technologies

$11.94

**

Synutra International

$44.20

*

Centerline Holding

$2.47

*

Nymox Pharmaceutical (Nasdaq: NYMX  )

$5.36

*

Sources: Motley Fool CAPS, Yahoo! Finance.

I own stock in aircraft equipment maker Astronics, so I've a natural interest in finding out who else is buying shares. Only four funds have gone shopping for Astronics recently, and of those, only frequent column guest TFSMarket Neutral (TFSMX) earns five stars from ratings agency Morningstar. Allow me to reintroduce you.

A no-load winner with a higher-than-I'd-prefer 2.48% expense ratio, TFS Market Neutral employs hedging strategies to protect principal in turbulent times like these. They're working well: Market Neutral's 2.8% year-to-date return is seven percentage points better than the category average.

Here's a look at the top five stocks the team at TFS Market Neutral is holding as of this writing:

Company

Latest Closing Price

CAPS Rating (out of 5)

Bruker (Nasdaq: BRKR  )

$14.54

****

Solera Holdings (NYSE: SLH  )

$28.83

**

T-3 Energy Services (Nasdaq: TTES  )

$57.70

*****

Hanger Orthopedic (NYSE: HGR  )

$17.55

*****

Venoco (NYSE: VQ  )

$17.37

**

Sources: Morningstar, Motley Fool CAPS.

Much as I like Hanger Orthopedic, which was founded during the American Civil War and helped to bring about the prosthetic limb, the stock jocks at Market Neutral have been reducing their stake in the company.

What are they buying? Bruker, which used to be known as Bruker BioSciences. A new position for the fund as of June 30, this company specializes in equipment for biotech and related types of research. CAPS All-Star pennysplants explained the thesis in this pitch from December:

Thank goodness I saw the "light" before closing out this position. BRKR is consolidating *ITSELF*. Buying subsidiaries. Will be highly ACCRETIVE to earnings almost immediately. In a sector I love. High insider ownership. Have a few lingering questions about management. Watch closely.

I'll add that Bruker BioSciences has mostly improved its gross margin and returns on invested capital since 2003. And trading for 20 times forward earnings, the stock appears to be no worse than reasonably priced.

CEO Frank Laukien, on the other hand, might call Bruker cheap. He has purchased 220,000 shares of his company on the open market since February. His last buy was made earlier this month at an average price of $13.71 a share. Color me impressed.

But I'm more interested in what you think. Would you own Bruker, or any of the stocks in the TFS Market Neutral fund, at today's prices? Log in to CAPS today and let us know what you think. It's 100% free to participate.

If you like seeing what superior stock pickers are buying, consider Motley Fool Champion Funds. Its collection of market-beaters is up 17 percentage points on their respective benchmarks as of this writing. Examine the entire portfolio with a free, no-risk trial.

Fool contributor Tim Beyers, who is ranked 18,820 out of more than 115,000 participants in CAPS, owned shares of Astronics at the time of publication. Morningstar is a Stock Advisor pick, and the Fool owns shares of it. The Fool's disclosure policy has recurring fantasies about a desert island, margaritas, and a plate of burritos.


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