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Billionaire Leon Cooperman’s Favorite Stock Picks

Leon Cooperman has been a well-known investor, praised for his stock picking skills for decades. However, his recent performance has not been great, with his fund, Omega Advisors posting losses in both 2014 and 2015. And, it looks like 2016 could be yet another tough year for the famed hedge fund. A look into the performance of Omega’s 53 equity stakes in companies with a market capitalization of more than $1.0 billion revealed a weighted average loss of 2% over the second quarter, and a 0.6% loss year-to-date. Conversely, the S&P 500 Index gained almost 2.7% during the first three months of 2016. In this article we will take a look into Omega’s top stakes in order to find out what’s changed, and how its picks have performed since the second quarter ended.

We believe that imitating hedge funds and other large institutional investors can be helpful in identifying stocks capable of outperforming the broader market. Through extensive research that covered portfolios of several hundred large investors between 1999 and 2012, we determined that following the small-cap stocks that large money managers are collectively bullish on, can generate monthly returns nearly 1.0 percentage points above the market (see the details here).


#5. Allergan plc Ordinary Shares (NYSE:AGN)

– Shares Owned by Omega Advisors (as June 30): 671,212

– Value of Omega’s Holding (as of June 30): $155.11 Million

Allergan plc Ordinary Shares (NYSE:AGN) rose two spots in Cooperman’s equity portfolio during the second quarter, even though the stock lost almost 20% of its value, as the fund boosted its exposure by 20%. Even though plenty of funds left the company between April and June, the stock was still the fifth most popular among the funds  we track, counting on the support of 131 funds as of June 30. Among the most bullish institutional investors was Carl Icahn’s Icahn Capital LP, which initiated a stake comprising 3.4 million shares, valued at $785 million, during the second quarter. Shares of Allergan plc Ordinary Shares (NYSE:AGN) staged a rebound in July, before returning into the red territory. However, quarter-to-date the stock has gained 1.1%. Last week, Mizuho Securities upgraded the stock to ‘Buy’ from ‘Neutral’, boosting its price target to $318 from $248.

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#4. AerCap Holdings N.V. (NYSE:AER)

– Shares Owned by Omega Advisors (as June 30): 4.62 Million

– Value of Omega’s Holding (as of June 30): $155.27 Million

Slightly more valuable than the stake in Allergan was Cooperman’s position in AerCap Holdings N.V. (NYSE:AER), even though the fund cut the stake by 6% during the second quarter. Even more bullish on the stock was David Einhorn’s Greenlight Capital, which last disclosed ownership of 11.39 million shares worth roughly $382.8 million. AerCap Holdings N.V. (NYSE:AER), which lost roughly 14.1% over the second quarter, has managed to recuperate more than 19.1% of its value since the end of June. Most recently, the stock has been helped by the authorization of a new $250 million buyback program, to be added to the two preexisting programs for this year, and, earlier, by better-than-expected results for the second quarter. EPS of $1.53 came in $0.05 ahead of the consensus estimate, while revenue of $1.24 billion was $10 million higher than expected.

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