Billionaire Kerr Neilson’s Cheap Stock Picks Include Microsoft

The fund initiated a position of 1.3 million shares in Baker Hughes Incorporated (NYSE:BHI), a drilling equipment and services company best known for its brand-name drill bits. The stock trades at 13 times earnings, whether we look at trailing results or the consensus for 2013. Even though there has been a period of high drilling activity in the onshore U.S. and revenue has been up, Baker Hughes has been reporting considerably lower earnings and it might best be avoided at this time. Value investor Edgar Wachenheim’s Greenhaven Associates owned 6.3 million shares at the end of September.

Halliburton Company (NYSE:HAL) was another of Platinum’s cheap stock picks with the fund having 1.7 million shares of the stock in its portfolio. Billionaire Leon Cooperman’s Omega Advisors increased its own stake in Halliburton by 26% during the third quarter to a total of 3.3 million shares (see more stocks Cooperman was buying). As with Baker Hughes, the company hasn’t actually capitalized on oilfield activity as its earnings are down, but as with that company it is trading cheaply- the current valuation is 12 times trailing earnings.

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