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When a company announces that it is being taken over or acquired, its stock price usually jumps to reflect the takeover premium being paid for the company. This is why analysts and investors closely follow potential takeover/leveraged buyout (LBO) target companies.

We ran a screen with this idea in mind, beginning with a list of rumored potential takeover/LBO targets from various sources including CNN Money and Minyanville. We screened these stocks for those that may be trading at attractive prices, with float shorts above 10%.

We then screened for those with bullish sentiment from institutional investors, with significant net institutional purchases over the last quarter representing at least 5% of share float. This indicates that institutional investors such as hedge fund managers and mutual fund managers expect these names to outperform.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for up to six of the stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.

We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.

Do you think hedge funds expect these names to be taken over? Use this list as a starting point for your own analysis.

List sorted by net institutional purchases over the last quarter as a percent of share float.

1. Abiomed Inc. (ABMD): Engages in the research, development, and sale of medical devices that provide circulatory support to acute heart failure patients across the continuum of care in heart recovery. Market cap at $905.35M, most recent closing price at $23.24. Float short at 17.47%. Takeover/LBO rumor sourced from CNBC. Net institutional purchases in the current quarter at 7.3M shares, which represents about 22.62% of the company's float of 32.27M shares.

2. RadioShack Corp. (RSH): Engages in the retail sale of consumer electronic goods and services through its RadioShack store chain and kiosk operations. Market cap at $464.34M, most recent closing price at $4.60. Float short at 35.90%. Takeover/LBO rumor sourced from CNN Money. Net institutional purchases in the current quarter at 19.4M shares, which represents about 19.7% of the company's float of 98.46M shares.

3. Human Genome Sciences Inc. (HGSI): Operates as a biopharmaceutical company. Market cap at $2.84B, most recent closing price at $14.20. Float short at 13.06%. Takeover/LBO rumor sourced from Minyanville. Net institutional purchases in the current quarter at 23.8M shares, which represents about 11.99% of the company's float of 198.44M shares.

4. athenahealth, Inc. (ATHN): Provides ongoing billing, clinical-related, and other related services to medical group practices primarily in the United States. Market cap at $2.63B, most recent closing price at $72.73. Float short at 24.52%. Takeover/LBO rumor sourced from Seeking Alpha. Net institutional purchases in the current quarter at 4.2M shares, which represents about 11.93% of the company's float of 35.21M shares.

5. Alnylam Pharmaceuticals, Inc. (ALNY): Focuses on the discovery, development, and commercialization of novel therapeutics based on RNA interference. Market cap at $534.57M, most recent closing price at $10.11. Float short at 11.74%. Takeover/LBO rumor sourced from Seeking Alpha. Net institutional purchases in the current quarter at 3.9M shares, which represents about 9.42% of the company's float of 41.40M shares.

6. Exelixis, Inc. (EXEL): Engages in the discovery, development, and commercialization of small molecule drugs for the treatment of cancer, metabolic, and cardiovascular disorders. Market cap at $730.52M, most recent closing price at $4.79. Float short at 13.67%. Takeover/LBO rumor sourced from Minyanville. Net institutional purchases in the current quarter at 8.0M shares, which represents about 5.51% of the company's float of 145.25M shares.

*Institutional data sourced from Fidelity, all other data sourced from Finviz.

Source: 6 Highly Shorted Takeover/LBO Targets Being Bought By Hedge Funds