Morgan Stanley, Ford, and More: George Soros’s New Stock Picks

Soros also liked Anadarko Petroleum Corporation (NYSE:APC), buying up almost 760,000 shares of the oil and gas company. 62 filers in our database reported a position in Anadarko, which made it the most popular energy stock among hedge funds (see more energy stocks hedge funds loved). Anadarko’s earnings multiples are in the teens- the trailing and forward P/Es are 17 and 15 respectively- but that represents a premium to the oil majors and the company’s revenue has actually been down. It might be worth looking at on the basis of its popularity but we are not particularly excited about the stock.

The 13F disclosed a new position of about 950,000 shares in Plains Exploration & Production Company (NYSE:PXP). The oil and gas company is an acquisition target as Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX) plans to buy it and a related company. Many investors like to invest in merger arbitrage investments because the returns are uncorrelated with the stock market, though there are of course risks (read more about merger arbitrage strategies). Plains itself had expanded from natural gas to offshore oil assets earlier in 2012.

Ford Motor Company (NYSE:F) rounded out the five largest new positions that Soros reported owning at 3.1 million shares. Ford’s revenue edged up in the fourth quarter of 2012 versus a year earlier, and many value investors have been bullish on autos for several months. The market in general is quite pessimistic about Ford, as it trades at 9 times trailing earnings. The sell-side generally expects improvements on the bottom line with the result being that the five-year PEG ratio is a bit below 1. Appaloosa Management, managed by billionaire David Tepper, had over 11 million shares of Ford in its own portfolio at the beginning of January (check out more stocks Appaloosa owned).

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