Exxon Mobil (XOM), Verizon Communications (VZ) Among Steven Cohen’s Key Defensive Picks

Page 1 of 2

SAC CAPITAL ADVISORSBillionaire Steven Cohen founded SAC Capital in 1992 and now manages upwards of $14 billion in assets. After reviewing Cohen’s recent 13F filing with the SEC, we found five stocks that he is heavily invested in that provide investors with low volatility and strong performance despite an uncertain economic backdrop. Cohen’s fund focuses on both fundamental and quantitative strategies (check out Steven Cohen’s top moves).

Verizon Communications Inc. (NYSE:VZ) was a huge increase for Cohen last quarter; he upped his stake over 10,000%. The increasing need for wireless data services should be a driving force behind Verizon’s expected 4% revenue growth in 2013. Adding to this is the expected adoption of more smartphones across a rising population. Verizon trades in line with AT&T on various levels, but does standout on expected earnings – 5-year CAGR of 11.5% – compared to AT&T’s 6.5%. Further driving our investment thesis for Verizon is its steep valuation discount on a forward earnings basis, where the mobile provider trades at a 15x forward P/E compared to its trailing P/E of 40x. This, coupled with its 4.7% dividend yield and 0.5 beta, makes Verizon quite the defensive play. Ken Fisher, founder of Fisher Asset Management, is one of Verizon’s biggest supporters (see Ken Fisher’s newest picks).

Cohen also increased his stake in General Electric Company (NYSE:GE) by a whopping amount last quarter – over 30,000%. We believe it is hard to pass up GE’s diverse product base. GE derives over 80% of its revenues from for very different, very distinct segments. These include healthcare, energy, finance and aerospace. We like the prospects in all of GE’s segments and believe that the demand for innovative healthcare products will only increase with an aging population. Equally as important to the company, energy markets are already making demands for fossil fuel alternatives. GE pays a 3.5% dividend yield and presents investors with a solid value play, trading at only 13x forward earnings. Warren Buffett is just one of GE’s big-name investors (see Warren Buffett’s new picks here).

Mead Johnson Nutrition Co (NYSE:MJN) is Cohen’s 30th largest 13F holding and is a leader in pediatric nutrition following its 2009 spinoff from Bristol-Myers Squibb. With a rising global population and better health standards in emerging countries, Mead should continue to perform well. Mead posted 3Q results that came in at $0.71, compared to $0.78 for 3Q 2011, and revenues were down 1.3% year over year.

This decline has helped push Mead’s stock price down nearly 12% over the last three months. Mead has a relatively stable market – in part exhibited by its 0.7 beta – but also has growth opportunities outside of the U.S. China is one of Mead’s greatest opportunities despite the country’s recent slowdown. The majority of the nutrition company’s international sales come from the Asia-Latin America market (70%), which comprise nearly one-fifth of total top line revenues. Mead is also a major player in China’s baby formula market, with 17% of that particular market share. With that being said, emerging markets will play a key part in helping the nutrition company meet the Street’s 5-year expected earnings growth rate of 11%. Mead called billionaire and founder of Renaissance Technologies Jim Simons as its top fund owner last quarter (check out Jim Simons’ latest picks).

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 Laziest Countries in the World

The 10 Most Polluted Countries in the World

The 10 Most Dangerous Cities in America 2014

The Top 10 Gold Producing Countries in the World

The 10 Tallest Buildings in the World

The 10 Richest Stand Up Comedians in the World

The 10 Fattest Countries in the World

The 5 Best Summer Jobs for Teens

The 10 Most Religious Countries in the World Keeping the Faith

The 10 Most Educated Countries in the World

The 10 Most Popular Cell Phones in the World

The 10 Drunkest Countries in the World

The 10 Most Expensive Private Schools in the World

The 10 Smallest Countries in the World

Walking Dead Season 5 Spoilers You’ll Wish You Didn’t Know

The 10 Poorest Countries in the World

The 10 Greenest Countries in the World

The Top 10 Countries with the Highest Population in the World

The 10 Most Visited Countries in the World

The Top 10 Star Wars Characters in the Iconic Series

The 10 Most Expensive Android Phones in the World

5 Reasons Why The Illuminati Is Real and a Threat to Society

The 6 Scariest Halloween Costumes Ever Screamed At

The 4 Biggest Hedge Fund Managers in the World Today

The 15 Most Densely Populated Countries in the World

The 10 Biggest Tea Drinking Countries in the World

Top 6 Ways to Improve Your Checkout Process and Close Sales

The 5 Most Profitable Online Businesses You Can Start Today

The 20 Most Profitable Hospitals in the US

The 5 Most Profitable Home Businesses to Start

The 7 Teams that Will Win the Stanley Cup in 2015

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

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

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!