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The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage. The opinions expressed are those of the author and do not represent the views of TheStreet or its management.
NEW YORK (
Insider Monkey) -- Most investors are interested in what hedge fund managers recommend today.
Insider Monkey, your source for free
data, pays more attention to what they recommended in the past.
The annual Ira Sohn Investment Research Conference is, by some standards, the top venue for hedge fund managers to showcase their best ideas. In May 2009,
, Lee Hobson, Mark Kingdon, and
were among the hedge fund managers that presented a long or short investment idea at that conference.
We picked these hedge fund managers because their picks were highlighted in a
article. It's been almost two years since that conference, so whatever the investment thesis of those recommendations, they had ample time to come true. Here is how those
10 stocks recommended by top hedge fund managers
performed since that conference:
Strayer Education(STRA - Get Report): Lone Pine Capital's Stephen Mandel was extremely bullish about Strayer. "Strayer will be a far larger business 10 years from now, with cash flows a multiple of today's levels," he said. The interesting part came 10 minutes after Mandel's presentation.
was extremely bearish about for-profit education companies. Chanos explained that these companies spend too much money on advertising and their government funding will soon be cut. Chanos was bearish about these companies long before
Strayer closed at $175.11 (prices are adjusted for dividend payments and splits) on May 28th 2009. Today, Strayer closed at $122.40, losing more than 30% during the past 20 months. Chanos was right, Mandel seems wrong so far.
Lincare Holdings(LNCR): Jim Chanos was right about Strayer but he was wrong about Lincare. Chanos was expecting Lincare's prfit margins to weaken. The stock returned 93% since then. Of course, we should compare a short seller's performance based on a benchmark. The
Russell 2000 index ETF(IWM) returned 68% since then, so Chanos' performance isn't as bad as it may have first seemed.
General Growth Properties (GGP - Get Report): This was the best recommendation at the Ira Sohn Conference. General Growth Properties, then in bankruptcy, increased ten-fold since May, 2009.
Ackman stated that GGP
had "huge potential reward and generally limited risk." He was right then and he is still reaping the rewards of that investment. Ackman's GGP investment was the main reason Pershing Square returned 29.7% in 2010.