One of the most anticipated market players from this year’s Delivering Alpha conference on July 17th was billionaire Leon Cooperman of Omega Advisors. At last year’s conference, Cooperman had given ten names when asked for his “best idea” and all 10 performed strongly over the next year. As they say, past performance is no guarantee of future results but we think that investors can at least treat his picks as initial investment ideas and do further research on any interesting names. Read on for our quick take on five of the stocks Cooperman listed as his best ideas, or see the full list of stock picks from Omega’s most recent 13F filing (we track quarterly 13F filings from hundreds of hedge funds and other notable investors as part of our work researching investment strategies, including our market beating small cap strategy).
One of the billionaire’s picks was Express Scripts Holding Company (NASDAQ:ESRX), the pharmacy benefit management services company. Express Scripts Holding Company (NASDAQ:ESRX) has seen its financials recover now that its relationship with Walgreen (NYSE:WAG) has been repaired. The company continues to gain market share in its industry and is valued at a current-year earnings multiple of 15 based on sell-side estimates with earnings growth expected to continue in the future, and we think it is worth considering. Brookside Capital, Bain Capital’s equity hedge fund, reported a position of 3.9 million shares in Express Scripts Holding Company (NASDAQ:ESRX) at the end of Q1 2013 (research more stocks Brookside owned).
Cooperman also listed QUALCOMM, Inc. (NASDAQ:QCOM) as one of his “quality growth” picks. QUALCOMM, Inc. (NASDAQ:QCOM) has in fact been doing well: revenue rose 24% in its most recent quarterly report compared to the same period in the previous fiscal year, and earnings from continuing operations grew at a similar rate. In addition, the trailing earnings multiple is only 18- a reasonable valuation given this financial performance. Analysts also like it as shown by the five-year PEG ratio of 0.8. In the first quarter of 2013 QUALCOMM, Inc. (NASDAQ:QCOM) had made our list of the ten most popular stocks among hedge funds.