McMoRan Exploration (MMR) And 4 Other Key Stock Picks from Leon Cooperman

Published on January 14, 2013 at 5:00 pm by Marshall Hargrave in Hedge Funds

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McMoRan Exploration Co (NYSE:MMR) saw its stock up 80% in one day back in December 2012 following the announcement that Freeport-McMoRan would acquire the oil and gas exploration company. The acquisition of McMoRan is for $3.4 billion, or $2.1 billion net of the 36% of McMoRan that Freeport and Plains Exploration already owned.

McMoRan explores and produces oil and natural gas via shallow waters in the Gulf of Mexico and through onshore properties along the Gulf Coast. After being integrated into Freeport, McMoRan Exploration will be part of a U.S.-based natural resources company with oil and gas resources and metals mining operations. Billionaire T. Boone Pickens is one of the top-name investors in McMoRan Exploration as of his last 13F filing with the SEC (check out T. Boone Pickens’ top picks).

Atlas Resource Partners (NYSE:ARP) was Cooperman’s fifth largest small-cap holding on his last 13F. Atlas Resource is an oil and natural gas E&P master limited partnership (MLP), with most of its properties in the Barnett Shale and Appalachia regions of the U.S. Since going public last February, shares of ARP have only rewarded their original investors, but someone buying in six months ago–let’s say–would have lost close to 20% of their investment.

The obviously attractive aspect of this MLP is its 7.8% dividend yield, but it’s worth noting that the sell-side is expecting earnings to increase sixfold by the end of this year. Much of this growth is expected to come from Atlas Resource’s acquisition of DTE Gas Resources for $255 million, which boosts the company’s presence in the Fort Worth basin (North Texas). Long-term earnings growth is expected to average 10% a year over the next half-decade, pairing nice appreciative potential with ARP’s solid dividend payout.

McMoRan Exploration (MMR) And 4 Other Key Stock Picks from Leon Cooperman

Published on January 14, 2013 at 5:00 pm by Marshall Hargrave in Hedge Funds

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