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Billionaire Michael Price’s Best Ideas for 2016

Michael Price is the founder and manager of New York-based MFP Investors LLC. Although the value-focused hedge fund may not be as recognizable as other players in the industry, Price’s investment firm is widely-known for its focus on undervalued, unpopular and overlooked small-cap companies. The renowned investor’s equity portfolio was worth $811.38 million at the end of 2015, up from $669.06 million at the end of the third quarter. In terms of performance, MFP’s long positions in companies with a market capitalization of at least $1 billion generated a negative weight average return of 3.8% in 2015, based on the size of those positions at the beginning of each quarter. Given the hedge fund’s affinity towards small-cap stocks, we figured it would be particularly interesting to take a look at its most noteworthy moves made in the final quarter of 2015.

At Insider Monkey, we follow the activity of several hundred of the best-performing hedge funds as part of our strategy. We analyze their 13F filings and use the data to see what stocks they are collectively bullish on. Through extensive research we have determined that the best approach to outperform the broader indices is to follow hedge funds into their top small-cap ideas (see more details here).

Michael Price
Michael Price
MFP Investors

Of course, it is close to impossible to examine Michael Price’s equity portfolio without pointing out his largest equity holding, which is represented by Intel Corporation (NASDAQ:INTC). MFP Investors held its stake in the chip maker unchanged at 1.85 million shares during the December quarter, with the position being valued at $63.71 million. The shares of the leading provider of platforms in the PC market are down by 15% over the past 12 months, after having dropped by nearly 16% year-to-date. The company’s full-year 2015 net revenue totaled $55.36 billion, down from $55.87 billion reported for 2014. Intel Corporation (NASDAQ:INTC)’s Client Computing Group (CCG) segment, which offers platforms used in notebooks, desktop computers and other devices, continued to face weakness from the PC market throughout 2015. However, the company’s Data Center Group (DCG) segment continued to experience growth, with its net revenue increasing by 11% year-over-year due to higher platform unit sales and average selling prices. There are two key reasons investors may want to hold onto their investments in Intel. First, the stock trades at a forward P/E multiple that is below the average for the Semiconductor Equipment industry at 10.84 versus 12.80. And second, the company pays out an annualized dividend of $1.04 per share, which equates to a dividend yield of 3.61%. Billionaire Ken Fisher of Fisher Asset Management owns 19.60 million shares of Intel Corporation (NASDAQ:INTC) as of the end of December.

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