‘Hedge Hunter’ Roberto Mignone’s Favorite Investments: General Motors Company (GM), Morgan Stanley (MS), Google Inc (GOOG)

Earnings growth is expected to average between 21% and 26% over the next two years, and the stock isn’t ridiculously expensive at 20.6 times forward earnings.

Assured Guaranty Ltd. (NYSE:AGO) is Mignone’s fourth largest equity holding, and has been in the hedgie’s top ten since Q4 2011. The mid-sized credit protection company has already popped more than 32% in 2013 alone, hitting a new 52-week high last week. A key factor behind this appreciation was Assured’s court victory against Flagstar Bancorp in early February, and optimism is riding high on the toes of Q4 earnings. Despite their recent run-up, AGO shares still trade at a mere 7.1 times forward earnings and a 26% discount to their book value. Fellow fund managers Debra Fine and Wilbur Ross join Mignone in this stock, which is great company to have.

Google, lastly, rounds out Mignone’s “fab five,” so to speak. The tech giant has already rewarded shareholders significantly year-to-date, returning 13%. Shares trade just off their all-time high north of $800, but there’s still reason to believe in this stock, as it looks like another GARP play. Sell-side analysts expects EPS growth of a little over 17% next year, and over the longer term, forecasts predict annual expansion of 14-15% through at least 2017. Despite these prospects, Google still trades below 15 times forward earnings, and Wall Street’s average price target predicts another 5-6% in upside.

Google was also the third most popular stock among the 450-plus hedge funds we track last quarter, with 126 bulls in the crowd, so to speak. This total was smaller than Apple’s interest of 132 funds, but larger than Microsoft’s 95 total. With strong results like these, it’s always important to pay attention to the smart money, and this time is no different.

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