Petrologistics and More: Billionaire James Dinan’s New Stock Picks

York initiated a position of 1.1 million shares in Advance Auto Parts, Inc. (NYSE:AAP). At a market capitalization of $5.7 billion, the auto parts store trades at 15 times trailing earnings. That’s generally a good level to start looking for value. While a number of other auto related companies are valued even cheaper, auto parts retailers are much more independent of the broader economy (for example, Advance has a beta of only 0.5). Business has been about flat compared to a year ago. Citadel Investment Group moved heavily into Advance last quarter; that fund is managed by billionaire Ken Griffin (check out more stocks Griffin was buying).

Canadian Pacific Railway Limited (NYSE:CP) was another new stock pick in Dinan’s portfolio. Billionaire Bill Ackman of Pershing Square had Canadian Pacific as his largest long stock position at the end of the fourth quarter (research more stocks Pershing Square owned); the activist has been trying to improve the railroad, and the stock price is actually up 58% in the last year. In terms of earnings it is a bit more speculative, as both the market and the sell-side is expecting improvements on the bottom line.

Dinan and his team bought 1.8 million shares of TW Telecom Inc (NASDAQ:TWTC) between the beginning of October and the end of 2012, making the $3.8 billion market cap company (formerly known as Time Warner Telecom) its fifth largest new position. Renaissance Technologies, whose founder Jim Simons is now a billionaire, added shares of TW Telecom last quarter (see Renaissance’s stock picks). With the stock’s earnings multiples being high, we wouldn’t consider it a good pick in value terms though both sales and net income have been up compared to the same period a year ago.

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