Billionaire Louis Bacon’s Long Term Stock Picks Include Citigroup Inc (C)

Bacon and his team have also consistently liked News Corp (NYSE:NWSA), which recently split into News Corp and Twenty-First Century Fox. In theory corporate breakups, similarly to spinouts, improve operations as management becomes better able to focus on the core business. Wall Street analysts are predicting that News Corp will generate earnings per share of 55 cents during the current fiscal year (which ends in June 2014), a forecast which implies a current-year P/E multiple of 30. That seems a bit high to be interesting, even with the prospect of better operations.

According to the 13F, Moore Global had a little over 1 million shares of Marathon Oil Corporation (NYSE:MRO) in its portfolio at the beginning of April. Marathon recently spun out its downstream operations under the Marathon Petroleum name in order to become more focused on exploration and production activities. The trailing and forward P/Es of 17 and 12, respectively, show that currently the stock is priced at a premium relative to the larger and more integrated oil majors but that the sell-side does expect net income to grow considerably over the next year and a half.

Marathon Oil therefore seems like it may be worth watching to see if management can in fact deliver the increased earnings that the Street is expecting. Value investors should also be interested in both of Moore’s long term picks in the banking industry (though a portfolio should not be too concentrated in financials) and Assured Guaranty- while it does have some risks- appears to be worth investigating as well given its low earnings multiples.

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