Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Billionaire Dan Loeb’s Cheap Stock Picks: Delphi Automotive PLC (DLPH), Murphy Oil Corporation (MUR), Tesoro Corporation (TSO)

The 13F shows that Loeb bought 3.1 million shares of Herbalife Ltd. (NYSE:HLF)– likely after being unimpressed with billionaire Bill Ackman’s presentation arguing for shorting the stock and seeing the price collapse. Find Ackman’s favorite stocks. Of course, fellow billionaire Carl Icahn has become the highest-profile Herbalife long following a charged argument with Ackman on CNBC but this is a sizable position for Third Point as well. Certainly on a quantitative basis Herbalife is cheap at 10 times trailing earnings, though short interest remains high and some of Ichan’s proposed moves (including a buyout) seem unlikely given concerns that- at least in the long run- Herbalife is a pyramid scheme.

A somewhat lower profile battle is brewing at Agrium Inc. (USA) (NYSE:AGU) where Barry Rosenstein’s JANA Partners has called for a breakup of the company’s wholesale and retail businesses. Agrium sells agricultural products through these two channels, and its earnings multiples clock in at 10 or slightly higher. Last quarter revenue edged up 3% compared to the fourth quarter of 2011, and while earnings growth was high in percentage terms that growth rate is not sustainable. Agrium’s management has resisted JANA’s move, and as a result we think it is another candidate for a watchlist rather than a portfolio.

Disclosure: I own no shares of any stocks mentioned in this article.

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.