Hedge Fund Emerging Sovereign Group’s Stock Picks for 2013

Priceline.com Inc (NASDAQ:PCLN) was another of Emerging Sovereign’s favorite stocks with the fund owning about 130,000 shares at the start of the year. Priceline is another large-cap growth stock; the trailing and 2013 P/E multiples are 26 and 19, respectively but growth on both top and bottom lines has been very strong. Priceline hopes to continue its growth in the travel website space through its acquisition of Kayak Software Corp (NASDAQ:KYAK), though there have been some concerns about the premium it is paying. Priceline made our list of the most popular services stocks among hedge funds in Q3.

The second most popular stock of all at the same point, Google Inc (NASDAQ:GOOG), was also present in Kenny’s portfolio as Emerging Sovereign increased the size of its position from about 90,000 shares to about 110,000 during the fourth quarter of 2012. Check out the full top ten list. Google Inc (NASDAQ:GOOG) actually reported earnings growth last quarter versus a year earlier, as improved results in the search business overcame the hit to net income from the addition of Motorola Mobility Holdings. The forward P/E, based on expected results for 2014, is only 14 and so Google Inc (NASDAQ:GOOG) may be worth a look.

Emerging Sovereign also liked Mead Johnson Nutrition Co (NYSE:MJN), initiating a position of 1.1 million shares in the food company best known for its infant and children’s food products. Earnings multiples are high here as well- for example, the stock trades at 26 times trailing earnings- but Mead Johnson Nutrition has been recording high earnings growth recently. Billionaire Ken Griffin’s Citadel Investment Group sold shares of the company during the third quarter of 2012 but still closed September with a little over 1 million shares in its portfolio (research more stocks Citadel owned).

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