Billionaire James Dinan’s High Upside Potential Picks Include AIG

Dun & Bradstreet Corp (NYSE:DNB) was a new pick in the fund’s portfolio as Dinan and his team bought 1.3 million shares of the stock. The information and risk management company carries trailing and forward P/E multiples of 13 and 10, respectively, with a PEG ratio of 0.8. It is another popular short target with 13% of the outstanding shares held short as of the most recent data, and while net income was up in its most recent quarterly report from a year ago revenue was down. John Shapiro’s Chieftain Capital owed 2.2 million shares of Dun & Bradstreet (check out more of Shapiro’s stock picks).

The fund cut its stake in Tyco International Ltd. (NYSE:TYC) but the company remained in its top ten holdings as York still owned 1.6 million shares. Tyco’s PEG ratio of .75 also made it a high upside potential pick. Large hedge fund D.E. Shaw, managed by billionaire David Shaw, was buying Tyco in the third quarter (find D.E. Shaw’s favorite stocks). Tyco recently spun out two of its business divisions, one into a public company and one into a merger.

York bought shares of MetroPCS Communications Inc (NYSE:PCS), yet another stock with considerable short interest. MetroPCS’s forward P/E is 12, and expectations for earnings growth over the next several years lead the PEG ratio to be 0.7. Billionaire John Paulson’s Paulson & Co. also bought into MetroPCS, closing September with almost 24 million shares in its portfolio after not having owned any shares of the stock three months earlier (see more stocks Paulson was buying).