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Hedge Fund Trade of the Week: ITT

Where’s the fast money finding opportunity? In this regular feature Anthony Scaramucci aka The Hedge reveals his latest greatest pick!

This week’s trade is long ITT, a diversified manufacturer that operates in more than 60 countries.

According to its website, the company’s portfolio of businesses is aligned with enduring, global growth drivers and focused on three areas, defense, motion and flow control and fluid technology.

Check out the chart and some of the company’s stats:

ITT (ITT)
Sector: Capital Goods
Industry: Aerospace and Defense
Based in: White Plains, NY
Market Cap: $10.4 billion
52-week high: $64
52-week low: $42.05

Anthony Scaramucci selects this stock as his Hedge Fund Trade of the Week because “it’s a fabulous value name,” he says.

Specifically Scaramucci is bullish because of ITT’s plan to spin-off the three different divisions mentioned above. He considers the stock a sum of the parts story with “upside anywhere between 13.5 – 50%.”

However, Scaramucci concedes that there could be some risk, because "its very laden with defense contracts. 70% of the defense side of the business is controlled by the Pentagon and that spending is going down. There is a slight risk to this story," he says.

But Scaramucci thinks the valuations are so attractive the potential rewards outweigh the risks.

And it’s not just Scaramucci who find ITT attractive. Other value hedge funds including Eaton Park, Perry Capital, and MFP are also long.

* you can find our conversation with Scaramucci about 5 minutes into this video.

Click here to check out other Hedge Fund Trade Of The Week posts

* Anthony Scaramucci runs SkyBridge Capital, a leading alternative asset manager with more than $7 billion under management. Every week on Fast Money, Scaramucci, aka 'The Hedge', takes you behind the hedges, giving you an unprecedented look at the names getting the most chatter amongst the hedge fund community.



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Trader disclosure: On May 16, 2011, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Terranova Owns (OXY); Terranova Owns (XOM); Terranova Owns (KSS); Terranova Owns (BJ); Terranova Owns (DIS); Terranova Owns (TM); Terranova Owns (MCD); Terranova Owns (PEP); Terranova Owns (PFE); Terranova Owns (BAX); Terranova Owns (V); Terranova Owns (JPM); Terranova Owns (VRTS); Finerman and Finerman's firm own (AAPL); Finerman and Finerman's firm own (BP); Finerman and Finerman's Firm own (CMI); Finerman's Firm owns (IBM); Finerman owns (C); FInerman owns (JPM); Finerman's Firm owns (JPM) leaps and (JPM); Finerman's Firm owns (TGT); Finerman owns (UNG); Finerman's Firm is short (IWM), (MDY), (SPY); FInermans firm is long S&P Puts, Russell 2000 Puts;Weiss owns (UUP); Weiss owns (NS); Weiss owns (ETP); Weiss owns (COP); Weiss owns (DVN); Weiss owns (BRCM); Weiss owns (MRK); Weiss owns (AKAM); Weiss owns (DE); Weiss owns (NAV); Weiss owns (JPM); Weiss owns (HBAN); Weiss owns (NIHD); Weiss owns (HK); Weiss owns (TWM); Weiss is short (X)

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