Leon Cooperman was the CEO and chairman of Goldman Sachs Asset Management. He worked at Goldman Sachs for 25 years. In 1991, he left Goldman and started Omega Advisors. He has been extremely bullish about US equities for a while now. He thinks interest rates are going to go up, so he urges investors to consider stocks instead of bonds. So far he has been right.
During the first quarter, Cooperman completely sold his holdings in 33 stocks. Unfortunately these stocks performed better than his remaining holdings and the S&P 500 index. Dean Foods (DF) increased 23%, Liberty Media (LCAPA) and Lorillard (LO) increased 16%, and Sirius XM (SIRI) gained 33%. Overall these stocks gained 2%. Leon Cooperman had 37 stock picks that are constituents of the S&P 500 index. These stocks gained 0.1% during the second quarter, same as the index itself. We are interested in Cooperman’s new positions and the positions he increased significantly. Here is how these fresh stock picks performed in the second quarter:
CompanyName | Ticker | Value | Activity | Return |
DISCOVERY COMM | 94775 | New | 4% | |
ATLAS ENERGY INC | 85244 | New | -2% | |
VERIZON | 77805 | New | -2% | |
C V S CAREMARK | 73033 | New | 10% | |
SUNOCO INC | 64970 | New | -8% | |
GIVEN IMAGING | 57761 | New | 3% | |
CITRIX SYSTEMS | 56807 | New | 9% | |
GENON ENERGY | GEN | 56424 | 159% | 1% |
JABIL CIRCUIT INC | 56366 | 169% | -1% | |
METLIFE INC | 47239 | 428% | -2% | |
BANK OF AMERICA | 33818 | New | -18% | |
LOWES COMPANIES | 30545 | New | -11% | |
AON CORP | 29234 | New | -3% | |
APPLE INC | 28015 | 88% | -4% | |
INTL GAME TECH | 25416 | New | 9% | |
QUALCOMM INC | 20024 | New | 4% | |
VALASSIS COMM | 16292 | New | 4% | |
GOODYEAR TIRE | 15891 | New | 12% | |
P N C FINANCIAL | 12522 | New | -5% | |
B P PLC | 12478 | New | 1% | |
SALESFORCE COM | 9351 | New | 12% | |
WENDYS ARBYS | 1938 | New | 1% | |
BEBE STORES INC | 651 | New | 5% | |
OFFICE DEPOT INC | 618 | New | -9% | |
GOOGLE INC | 352 | New | -14% |
These stocks performed slightly better than the S&P 500 index, gaining 0.3% in the second quarter. Cooperman’s largest new stock pick was Discovery Communications, which gained 4%. Chase Coleman’s Tiger Global had the largest position in DISCK at the end of first quarter. Coleman was one of the most successful hedge fund managers in 2010 and returned more than 15% so far in 2011 (Check out Coleman’s favorite stock picks).
Cooperman’s other profitable new stock picks were Salesforce.com, Goodyear, CVS Caremark, and Citrix. David Tepper has more than $200 Million in GT. John Griffin and Stephen Mandel are bullish about CTXS. However the most popular stock among hedge funds is CVS. Highfields Capital and Relational Investors have around $700 Million in CVS each. Larry Robbins have more than $300 Million in CVS as well. Israel Englander, David Einhorn, and George Soros have around $100 Million in CVS too (See George Soros’ favorite stock picks here).
We like Cooperman’s stock picks and believe investors can beat index funds by imitating Cooperman’s favorite stock picks. We also agree with Cooperman that stocks will outperform bonds in the next few years. Investors can check out Cooperman’s entire portfolio here.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
