Billionaire Leon Cooperman’s High Upside Potential Picks Include Apple Inc. (AAPL)

Page 1 of 2

One way to estimate a stock’s upside potential- while, to some degree, restricting oneself to fairly reasonable earnings projections- is to use the PEG ratio, which is derived from analyst expectations of earnings growth and the traditional P/E multiple. Of course, the sell-side is often wrong and so “high growth potential” should be treated like any other screen: a list of suggestions to consider further before making any decisions. We decided to look for high upside potential stocks that billionaire Leon Cooperman’s Omega Advisors reported owning in its most recent 13F filing (see the full list of Cooperman’s stock picks). Here are five stocks which Omega had over $100 million invested in and which had low PEG ratios (indicating that their P/Es are lower than their expected growth rates would predict):

OMEGA ADVISORS

Omega’s top stock pick, American International Group, Inc. (NYSE:AIG) is quite a high potential pick: the PEG ratio is .43 as the market is placing a low value on its earnings but Wall Street analysts expect solid growth in net income. AIG also looks cheap in terms of book value, as it trades at about half the book value of its equity. These attractive value characteristics made it one of the ten most popular stocks among hedge funds in the third quarter of 2012 (see the full top ten list). The fund owned 8.1 million shares of AIG after increasing its stake by 76%.

Cooperman and his team also liked SLM Corp (NASDAQ:SLM), or “Sallie Mae,” reporting a position of almost 16 million shares. The student loan servicer and processor trades at 8 times earnings, whether we consider trailing results or analyst consensus for 2013, and the PEG ratio is 0.7. D.E. Shaw, founded and managed by fellow billionaire David Shaw, was buying the stock during the quarter and closed September with 5.4 million shares in its portfolio (check out more stocks D.E. Shaw was buying). We’re a bit worried about the student lending industry but Sallie Mae might be worth consideration.

Omega also liked Apple, Transocean, and a mortgage services company:

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

10 High Paying Seasonal Jobs in America this Holiday Season

The 10 Busiest Shipping Lanes in the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!