Occidental Petroleum Corporation (OXY), Covidien plc (COV): Three Interesting New Buys from Leon Cooperman

Recently, the company has approved the spin off of its Mallinckrodt pharmaceuticals business, to focus solely on the Medical Devices business. It announced that investors could get one ordinary share of Mallinckrodt for every eight Covidien plc (NYSE:COV) shares. Covidien said that it would have no ownership interest in Mallinckrodt after the distribution. Jose E. Almeida, Chairman and CEO of Covidien plc (NYSE:COV) commented: As separate companies, Covidien and Mallinckrodt will have greater flexibility to focus on and pursue their respective growth strategies and capital needs, while potentially providing shareholders with greater value over the longer term. At $65.20 per share, Covidien is worth nearly $30.70 billion on the market. The market values the company at 10.35 times EV/EBITDA.

Among the three, LyondellBasell seems to be income investors’ favorites, as it pays its shareholders dividends with the highest yield at 3%. Occidental ranked second with 2.8% dividend yield while the dividend yield of Covidien is the lowest, at 1.6%.

My Foolish take

Among the three, I like LyondellBasell and Occidental the most due to their decent dividend yields and low EV multiple. For Covidien, I would wait and see the detail pro-forma numbers of both Covidien and Mallinckrodt to determine whether or not the parent and/or the newly spinoff is a good investment opportunity.

The article Three Interesting New Buys from Leon Cooperman originally appeared on Fool.com and is written by Anh HOANG.

Anh is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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