Billionaire David Tepper’s Top 5 Stock Holdings

3. T-Mobile US, Inc. (NASDAQ: TMUS)

Communication services company T-Mobile US, Inc. (NASDAQ: TMUS) has generated big gains for David Tepper’s hedge fund in 2020. This is because the hedge fund is holding a big position in T-Mobile US and its shares rallied almost 60% in the last twelve months. TMUS is the third-largest stock holding of Appaloosa Management, accounting for 10.54% of the overall portfolio.

Oakmark Funds, which returned 23% for the second quarter, highlighted the confidence in T-Mobile US in an investor’s letter. Here is what Oakmark Funds stated:

“We initiated a position in T-Mobile after the company announced that regulators would approve its merger with Sprint. AT&T and Verizon have long dominated the market for wireless services due to their incumbent network quality advantage. The recently closed merger of T-Mobile and Sprint creates the first opportunity for a challenger to build the fastest, most reliable and highest capacity wireless network in the United States. We believe the impact of this combination will be non-linear from not only a network perspective but also a financial one. Our long-term investing horizon enables us to look several years ahead to assess the benefits of scale, synergy and low-incremental cost growth, which should generate more subscribers, faster revenue growth and higher margins. We like that the company will be led by veteran T-Mobile managers who have successfully integrated previous acquisitions and have gained impressive market share, despite a previously inferior network. A secondary offering by a large, non-economic seller gave us the opportunity to purchase our stake at a below market price.”