David Tepper's New Bullish Stock Picks

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Includes: ANRZQ, CLF, CLMT, CVI, ETFC, GM, GOOG, GT, MAS, MHGC, MOS, MRO, NCT, SAN, TSO, VLO, WLT, WNR
by: Insider Monkey

David Tepper launched Appaloosa Management in 1993. He gained international recognition in 2003 when Appaloosa returned 148.8%. Additionally, Tepper’s Appaloosa Management realized 132% return in 2009 owing to investments in some of the largest banks of America. However, he is not as bullish about banks this time around. Since the beginning of 2011, Tepper has cut stakes in banks such as Citigroup, Wells Fargo, and Bank of America.

During the second quarter, David Tepper sold off Banco Santander (STD), Newcastle Investment Corp (NYSE:NCT), Morgans Hotel Group Co (NASDAQ:MHGC), and E*trade Financial Corp. (NASDAQ:ETFC). Tepper was able to successfully minimize his loss owing to the timely sell offs. Since the end of June, STD lost 27%, Newcastle lost 15%, Morgans Hotel lost 13%, and E*trade Financial Corp lost 19%.

David Tepper is known for his contrarian bets. He added 9 new companies to Appaloosa’s equity portfolio in the second quarter. Additionally, he at least doubled his stake in 5 companies. Here are Tepper’s bullish stock picks as of June:

Company

Ticker

Value (x1000)

Activity

Return Since June

VALERO ENERGY CORP NEW

VLO

198474

203%

-15%

C V R ENERGY

CVI

180576

371%

11%

MOSAIC CO.

MOS

161877

New

4%

WESTERN REFINING INC

WNR

50567

New

-5.5%

GOOGLE INC

GOOG

45574

New

3%

MARATHON OIL CORP

MRO

37087

182%

-21%

TESORO CORP

TSO

35057

283%

2%

MASCO CORP

MAS

29741

526%

-33%

GENERAL MOTORS CO

GM

11520

New

-29%

GOODYEAR TIRE & RUBR CO

GT

11124

New

-34%

CALUMET SPECIALTY PRODS

CLMT

7885

New

-5%

ALPHA NATURAL RESOURCES

ANR

2077

New

-33%

CLIFFS NATURAL RESOURCES

CLF

1886

New

-18%

WALTER ENERGY INC

WLT

1019

New

-35%

Click to enlarge

During the second quarter, he increased CVR Energy Inc (NYSE:CVI) by 371%. Tepper has the largest position in the company among the 300+ funds we are tracking. CVR Energy accounts for 4.25% of Appaloosa’s 13F portfolio. Tepper has profited from his investment in the company as CVR Energy returned 11% since the end of June. Dan Loeb’s Third Point has the second largest position in CVR Energy. The company is the third largest holding of Third Point’s equity portfolio (check out Dan Loeb’s top stock picks).

In the second quarter Tepper joined the list of high-profile hedge fund managers who got bullish about Google. David Tepper, like Stephen Mandel, purchased Google Inc (NASDAQ:GOOG) during the second quarter. He invested $45 million in the company. Stephen Mandel invested $425 million during the same period (see Stephen Mandel’s current stock picks). The investment was profitable as Google performed better than most companies. It returned 3% since the end of June.

As of June, Valero Energy Corp makes up 4.68% of Appaloosa’s equity portfolio. It is the fourth largest holding. During the second quarter, David Tepper increased his stake in the company by 203%. Tepper’s Appaloosa has the largest position in the company followed by Steven Cohen’s SAC Capital Advisors. Steven Cohen also increased his stake in Valero by 99% during the second quarter (view Steven Cohen’s favorite stocks). Since the end of June, Valero has lost 15%.

We like David Tepper. His top five new stock picks managed to outperform the market since the end of June We believe investors will be able to beat the market over the long term by imitating his top stock picks.

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