David Tepper's Top 10 Positions Have Gained 21% Since September

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 |  Includes: AAL, C, CF, CVI, DF, GT, IP, M, UAL, VLO
by: Insider Monkey

David Tepper is the founder of Appaloosa Management LP. The Tepper School of Business at Carnegie Mellon University is also named after him. Tepper is currently ranked as the 258th richest person in the world, according to Forbes. He made $4 billion in 2009, and his Appaloosa returned approximately 30% in 2010. Since the end of September last year, the largest 10 positions in the 13F portfolio of Appaloosa returned 21% so far, versus 15% for SPY in the same period. The calculation assumes that Tepper did not increase or reduce his stakes in these 10 positions.

Top 10 positions in Appaloosa's 13F portfolio as of September 30, 2011, had the following returns:

Company Name

Ticker

Value (x1,000)

Return since Sept.

C V R ENERGY

CVI

133384

9.04%

GOODYEAR TIRE

GT

108590

33.80%

VALERO ENERGY

VLO

98836

18.96%

MACYS INC

M

86502

31.17%

UNITED CONTINENTAL

UAL

77738

-4.90%

INTERNATIONAL PAPER

IP

77108

36.68%

DEAN FOODS

DF

70323

22.89%

C F INDUSTRIES

CF

66630

40.16%

CITIGROUP INC

C

64556

20.03%

U S AIRWAYS GROUP

LCC

51101

8.55%

Click to enlarge

The best performing position among Tepper's top ten positions is CF Industries Holdings Inc (NYSE:CF), a company that manufactures and distributes nitrogen and phosphate fertilizer products. CF returned 40.16% since the end of the third quarter, beating the market by more than 25 percentage points. At the end of September, there are 35 hedge funds with CF positions in their portfolios. For example, Appaloosa had $67 million invested in CF. Billionaire Jim Simons is bullish about CF as well. His Renaissance Technologies disclosed owning $71 million worth of CF shares at the end of September.

Macy's Inc (NYSE:M) also generated decent returns since the end of September last year. It was up 31.17% since the end of the third quarter, versus 14.59% for SPY in the same period. Macy's has a market cap of $14B and a relatively low P/E ratio of 12.70. Macy's is quite popular among hedge funds tracked by us. As of September 30, 2011, there are 44 hedge funds with Macy's positions. Appaloosa had $87 million invested in this stock. Lee Ainslie is also in favor of Macy's. His Maverick Capital initiated a brand new $100+ million position during the third quarter.

Citigroup Inc (NYSE:C), International Paper Co (NYSE:IP), Valero Energy Corporation (NYSE:VLO), Goodyear Tire & Rubber Co (NASDAQ:GT), and Dean Foods Company (NYSE:DF) also outperformed the market since the end of the third quarter last year. We like Tepper and his stock picks. Only three of Tepper's top the positions -- CVR Energy (NYSE:CVI), United Continental (NYSE:UAL), and US Airways Group (LCC) underperformed the market in that period. We believe that investors will be more likely to beat the market by focusing on Tepper's top stock picks. We encourage investors to research the stocks that Tepper is bullish about.

Disclosure: I am long C.