Billionaire David Tepper’s ETF Killer Stock Picks

Page 2 of 2

Appaloosa Management shed 42,500 shares Allergan plc (NYSE:AGN) during the third quarter, and reported ownership of 1.22 million shares valued at $280.59 million in its latest 13F. For the third quarter, the pharmaceutical company reported revenue and EPS at $3.62 billion and $3.32 respectively, well below consensus estimates, with notable increases in sales of drugs such as Botox and Restasis failing to prevent the underperformance. In addition, the drug maker expanded its share buyback plan to $15 billion from $10 billion. After the report, Allergan plc (NYSE:AGN) stock saw price target cuts from Leerink (to $266 from $294), UBS (to $240 from $300), and RBC Capital (to $279 from $300), although the analysts maintained their “Buy” recommendations. Recent news about incoming US President Donald Trump’s plan to crack down on rising drug prices and the US patent regulator’s approval of a request for a review on Restasis’ IP has rocked the drug maker’s stock. Allergan’s stock has plunged by 38% year-to-date, and is recently at record lows not reached since early 2014. A total of 115 investors tracked by Insider Monkey had investments in Allergan plc (NYSE:AGN) at the end of the third quarter, down by 16 funds compared to the end of June.

Similar to what it did to its Allergan holding, Appaloosa Management trimmed its position in Allstate Corp (NYSE:ALL) by 6% to 3.12 million shares worth $215.83 million during the third quarter. On November 28, the insurance company said that it had agreed to buy electronics warranty provider SquareTrade for $1.40 billion adding that the acquisition will remain an independent entity. The stock price fell by about $2 per share the day after the deal was announced, but has rebounded above pre-merger levels about a week after. There were 27 funds in our database bullish on Allstate Corp (NYSE:ALL) at the end of September, versus 29 funds a quarter earlier.

We’ll end the discussion with another tech giant: Facebook Inc. (NASDAQ:FB), which represented a new position in Appaloosa’s 13F portfolio as the fund acquired 1.48 million shares worth $190.43 million between July and September. Facebook’s stock reached an all-time high of $133.28 on October 24, ahead of the company’s earnings report. On November 2, Facebook Inc. (NASDAQ:FB) reported third-quarter revenue of $7.01 billion, which topped expectations by $90 million, and EPS of $1.09, beating the estimates by $0.12. However, the stock plummeted by $7 per share on the back of the results, as investors were disappointed by the company’s guidance of decelerating ad revenue and increased spending for 2017. Most analysts, undaunted by the forecast and maintaining their “Buy” ratings, suggested purchasing Facebook shares amid the recent weakness. Facebook recorded a 15% year-to-date increase in stock value. Among hedge funds tracked by Insider Monkey, 149 had shares in Facebook Inc. (NASDAQ:FB) at the end of the third quarter, up by one fund over the quarter.

Disclosure: none

Page 2 of 2