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Peninsula Capital Management is an asset management company founded in 1989 by Scott A. Bedford. Based in San Francisco, the company manages equity capital for institutions, endowments and high net worth investors. Peninsula employs long-short strategy and focuses on domestic equity investing. It aims at achieving superior returns throughout all market cycles, with an emphasis on preservation of capital. Since its establishment, Peninsula has consistently delivered outstanding results and has been one of the best performing managers. In the second quarter, Peninsula’s 13F portfolio returned about 0.61%, versus 0.02% for the S&P 500 (SPY). We like Peninsula and we believe that by focusing on its best stock picks, investors are more likely to beat the market in the long term.

Below we compiled a list of top 10 positions in Peninsula’s portfolio as of September 30, 2011.

Company

Ticker

Value (*$1000)

EVOLUTION PETROLEUM CO

EPM

14,120

GOLDCORP INC NEW

GG

5,705

MATTERSIGHT CORP

MATR

4,433

APPROACH RESOURCES INC

AREX

4,248

NORTHERN OIL & GAS INC

NOG

3,878

LIMELIGHT NETWORKS INC

LLNW

3,778

AGNICO EAGLE MINES LTD

AEM

2,976

NEWMONT MINING CORP

NEM

2,833

CARPENTER TECHNOLOGY C

CRS

2,245

ULTRATECH INC

UTEK

2,144

Peninsula disclosed owning $5.7 million worth of Goldcorp Inc (GG) as of September 30, according to its latest 13F. Three months earlier, the company did not disclose any shares of GG. Goldcorp is a gold producer engaged in the operation, exploration, development and acquisition of precious metal properties in Canada, the United States, Mexico and Central and South America. Its stock price has returned 20.64% so far this year. Most of the gain occurred after the end of the third quarter. It gained 18.29% since then. The company announced third-quarter revenue of $1.3 billion, up from the $885 million a year earlier. Jean-Marie Eveillard’s First Eagle Investment Management invested $183 million in GG at the end of June (check out Jean-Marie Eveillard’s top stock picks).

Peninsula also opened new positions in Limelight Networks Inc (LLNW), a provider of content delivery network services. Peninsula reported owning $3.78 million of LLNW and has made a bundle from this position as the stock soared 33.90% since the end of the third quarter. Limelight reported third-quarter net income of $5.02 million, up from a net loss of $5.95 in the same quarter last year. Ian Murray’s Lanexa Global Management had $1.6 million invested in LLNW as of June 30.

Peninsula also nearly doubled holdings in Approach Resources Inc (AREX). It increased its position in the stock to $4.25 million from $2.27 million. Approach is an independent energy company engaged in the exploration, development, production and acquisition of oil and gas properties. It reported third-quarter revenue of $27.96 million, up from $14.92 million for the same period last year. Net income was $7.07 million, compared with $2.09 million a year ago. The stock skyrocketed 79.46% since the end of September. Steven Cohen and T Boone Pickens had $3.8 million and $2.3 million respectively invested in AREX.

Evolution Petroleum Corporation (EPM) was the top position in Peninsula’s portfolio both this quarter and last quarter. Peninsula invested $12.1 million in the stock at the end of last quarter and increased its position to $14.1 million in the third quarter. Evolution Petroleum is a petroleum company engaged primarily in the acquisition, exploitation and development of properties for the production of crude oil and natural gas, onshore in the United States. The stock slightly declined 0.57% since the end of September but it has gained 7.18% so far since the beginning of this year. It is now trading at $7.02. A few insiders of the company, such as John Lovoi, bought the stock in late September at prices ranging from $6.73 to $7.14.

Peninsula also increased its position in Northern Oil & Gas Inc (NOG). It is an independent energy company engaged in the acquisition, exploration, exploitation and development of crude oil and natural gas properties. NOG gained 21.61% since the end of September. Peninsula increased its holdings in NOG from $1.99 million to $3.88 million. For the three months ending September 30, 2011, Northern Oil & Gas reported revenue of $43.68 million, compared with only $15.54 million a year ago. Net income also significantly increased from only $0.99 million to $28.62 million.

Over the third quarter, Peninsula sold out Western Digital Corp (WDC), Southwestern Energy Corp (SWN), Seagate Technology Plc (STX), Ultra Petroleum Corp (UPL), and Stec Inc (STEC). WDC and STEC only returned 3.50% and 1.08% since the end of September, during which SPY gained 11.94%. The other three stocks outperformed the index.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: Peninsula Capital's Q3 Portfolio Moves