Litespeed Management, L.L.C. was founded by Jamie Zimmerman in October 2000 and is an event-driven hedge fund focusing on special situations, distressed securities, and bankruptcies by providing its services to pooled investment vehicles.
It had more than $2.36 billion assets under management in March, 2014 and this fund invests only a small percentage of its assets in equities and options. Taken from Litespeed Management latest Adv, the fund reported to have 17 full and part-time employees. Five years after its establishment by Zimmerman the company gave back 118% between October 2000 and December 2005.
The portfolio is composed of 27 stocks and has a total value of $1,165 million.
On June 22, 2015, the hedge fund increased its stake of MedAssets Inc (MDAS), buying 1,438,577 new shares and reaching a total of 3,032,741 shares held (5.02% of MDAS’s outstanding shares).
MedAssets is a financial and performance improvement company providing technology-enabled products and services that, together, help mitigate the increasing financial challenges faced by hospitals, health systems and other nonacute healthcare providers.
In 2015 they are focused on four primary operational objectives. First is to gain greater visibility and solidify a positive growth trajectory. Second is to continue to address the increasing demand for advisory solutions capabilities. Third they will further capitalize on their strengths and market differentiation and finally, they are continuing to leverage Sg2 market insights across the system of care
The first-quarter financial performance was in line with their guidance and total net revenue for Q1 of 2015 increased by 8.6% and total net revenue growth was 2.4% on a year-over-year basis. Also net income had an increase of about 56.3% and cash provided by operating activities in the first quarter of 2015 was 95.1% up from the first quarter of 2014.
For 2015 they will go on improving customer success and financial performance. Once they have concluded their business assessment and set a go-forward strategic plan they will enter the next phase that is about executing their plan to optimize their business for future value creation across all dimensions, customer value, shareholder value. The company expects adjusted EBITDA margins to be in the range of 37% to 40% this year as we continue to see a mix shift to services revenue and we will continue to invest in growth initiatives and trailing adjusted EBITDA, and expect to be at or slightly below 3.5 times leverage by year-end 2015 also related fees to be a range of $22 million to $26 million in 2015.
On May 28, MDAS announced that it has extended its supply chain relationship with Jackson Health System, which will continue using MedAssets’ national group purchasing organization, and it will avail itself of MedAssets’ recently completed enterprise consulting engagement.
The company has null returns (ROE -5.28%, ROA -1.48% and ROC 24.12%) that are underperforming the 70% of the Global Health Information Services industry.
Comparing MDAS to its main competitor, McKesson Corporation (MCK), that has a market cap of $52.15 billion versus the $1.34 billion of MedAssets, MDAS is still much far to be one of the main companies in the Healthcare Information Services industry. MCK has an EPS of 6.27 while MDAS’ EPS ratio is negative (-0.42). Also, MCK’s net-income is 1.78 billion while MDAS’s net-income is -24.72 million.
The main holder of MDAS is Paul Tudor Jones (Trades, Portfolio) who holds 0.04% of outstanding shares, followed by Joel Greenblatt (0.03%) and Mario Gabelli (Trades, Portfolio) (0.02%). All these gurus reduced their stakes on Q1 2015, Paul Tudor Jones (Trades, Portfolio) by 60.59%, Joel Greenblatt (Trades, Portfolio) by 71.23% and Mario Gabelli (Trades, Portfolio) by 16.00%
