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Former Fidelity mutual fund manager and well-known investor Peter Lynch is still searching for bargains on Wall Street even if it involves a penny stock. The former Fidelity Magellan fund manager acquired a 5.2% stake in alternative medical treatments Imac Holdings Inc, as disclosed by the company in SEC filing.

Lynch tries to avoid owning more than 5% of a particular stock and didn’t realize that his $1.2 million stake put him over that threshold, requiring him to disclose it in a filing Wednesday, he said in an interview to Bloomberg. He likes smallcap stocks because ‘they are less well followed’, declining to discuss why he invested in Imac.

At Fidelity, Lynch generated annualized returns of 29% from 1977 to 1990, making him a Wall Street star who later wrote popular books on stock-picking. 

Lynch ran Fidelity's Magellan Fund for 13 years from 1977–1990 and he earned a reputation as a top performer, increasing assets under management from $18 million to $14 billion (as of 1990). He also authored several top-selling books on investing, including One Up on Wall Street and Beating the Street, and has been a generous contributor to the Boston community, the Catholic Schools Foundation and the Inner City Scholarship Fund.

Shares of Brentwood, Tennessee-based Imac rose over 4% to close Wednesday at 85 cents each, paring its decline for the year to 25%. The stock was down as much as 6.7% earlier in the day, but reversed course in the wake of Lynch’s filing with the Securities and Exchange Commission (SEC).

(With inputs from Bloomberg)

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