Great minds think alike. At this time, the two great minds of John Paulson and David Tepper are indeed in sync. Paulson, who made tens of billions dollars by buying CDS’s that were tied to the subprime mortgages during the past financial crisis, has since turned bullish on the financial stocks and many other things; Tepper was a bit of late in the gain but still profited smartly by going long on the equities and debts of the financial institutes in the first quarter of 2009, exactly the right time.
As we reported last week, Tepper told CNBC that his animal spirit is awakened (watch the video here and here) in view of what the Fed’s promised action to stimulate the economy.
On the other hand, John Paulson, speaking at the University Club in New York City recently, gave similar assessments across asset classes such as stocks, bonds, real estate, and gold. Here are the key points he made:
Read the complete article on Paulson at goldalert.com here.
At GuruFocus, we track the long equity positions of both Gurus, among many others (see the complete list here. According to the aggregated portfolio of the two, as of June 30, 2010, the two share 10 stocks ideas:
A brief review of the first five stocks:
Conseco Inc. (CNO, Financial)
CNO Financial Group, Inc. is a holding company for a group of insurance companies operating throughout the United States that develop, market and administer supplemental health insurance, annuity, individual life insurance and other insurance products. Conseco Inc. has a market cap of $1.39 billion; its shares were traded at around $5.54 with a P/E ratio of 7.5 and P/S ratio of 0.3.
Paulson owns 16,329,873 shares as of 06/30/2010, which accounts for 0.36% of the $22.7 billion equity portfolio of Paulson & Co..
Tepper owns 1,126,195 shares as of 06/30/2010, a decrease of 30.22% of from the previous quarter. This position accounts for 0.19% of the $2.87 billion equity portfolio of Appaloosa Management.
Bank of America Corp. (BAC, Financial)
Bank of America Corp. is one of the world's financial services companies. Bank Of America Corp. has a market cap of $132.85 billion; its shares were traded at around $13.24 with and P/S ratio of 0.9. The dividend yield of Bank Of America Corp. stocks is 0.3%.
Paulson owns 167,794,229 shares as of 06/30/2010, which accounts for 10.62% of the $22.7 billion equity portfolio.
Tepper owns 27,349,699 shares as of 06/30/2010, which accounts for 13.68% of the $2.87 billion equity portfolio.
Citigroup Inc. (C, Financial)
Citigroup Inc., the global financial services company. Citigroup Inc. has a market cap of $112.14 billion; its shares were traded at around $3.87 with and P/S ratio of 1.2.
Paulson owns 506,700,000 shares as of 06/30/2010, which accounts for 8.39% of the $22.7 billion equity portfolio.
Tepper owns 57,783,144 shares as of 06/30/2010, which accounts for 7.56% of the $2.87 billion equity portfolio.
The Hartford Financial Services Group In (HIG, Financial)
Hartford Financial Services is one of the nation's largest investment and insurance companies. The Hartford Financial Services Group In has a market cap of $10 billion; its shares were traded at around $22.5 with a P/E ratio of 5.4 and P/S ratio of 0.4. The dividend yield of The Hartford Financial Services Group In stocks is 0.9%.
Paulson owns 44,000,000 shares as of 06/30/2010, an increase of 245.1% from the previous quarter. This position accounts for 4.29% of the $22.7 billion equity portfolio.
Tepper owns 6,181,233 shares as of 06/30/2010, which accounts for 4.76% of the $2.87 billion equity portfolio.
Wells Fargo & Company (WFC, Financial)
Wells Fargo & Company is a diversified financial services company. Wells Fargo & Company has a market cap of $133.61 billion; its shares were traded at around $25.53 with a P/E ratio of 15.1 and P/S ratio of 1.4. The dividend yield of Wells Fargo & Company stocks is 0.8%. Wells Fargo & Company had an annual average earning growth of 5.1% over the past 10 years.
Paulson owns 17,500,000 shares as of 06/30/2010, which accounts for 1.97% of the $22.7 billion equity portfolio.
Tepper owns 7,901,200 shares as of 06/30/2010, which accounts for 7.04% of the $2.87 billion equity portfolio.
Not surprisingly, the stock ideas shared by Paulson and Tepper are mostly financials.
Check out Paulson’s complete equity portfolio here: http://www.gurufocus.com/ListGuru.php?GuruName=John+Paulson
Check out Tepper’s complete equity portfolio here: http://www.gurufocus.com/ListGuru.php?GuruName=David+Tepper
Check out the aggregated portfolio of the two here: http://www.gurufocus.com/gurutrac/holding_stat.php
GuruFocus provides real time information and insights of Investment Gurus such as Warren Buffett, John Paulson and David Tepper, for Premium Members. If you are not a premium member, click here to sign up or upgrade. 7-Day Free Trial is available.
As we reported last week, Tepper told CNBC that his animal spirit is awakened (watch the video here and here) in view of what the Fed’s promised action to stimulate the economy.
On the other hand, John Paulson, speaking at the University Club in New York City recently, gave similar assessments across asset classes such as stocks, bonds, real estate, and gold. Here are the key points he made:
Paulson reiterated his bullish call on stocks, noting the historically large discrepancy between the equity earnings yield of 7-8% and the 10-year note yield of 2.6%.
Furthermore, because of his belief that the Federal Reserve will continue to implement quantitative easing measures, Paulson is expecting substantial inflation in the next several years. The noted hedge fund manager stated that low double-digit inflation is possible by 2012.
Accordingly, Paulson is shorting longer-dated treasuries through 5 and 7 year calls on the 30-year Treasury bond.
In light of pending inflation, Paulson stressed that investors do not want to own long-dated liabilities, but rather should issue them. One of the most efficient ways for people to take advantage of this is through mortgages on residential real estate, noting that now is the best time in 50 years to purchase a home.
As for the gold price, Paulson remains very bullish on the yellow metal, noting that the price of gold has been highly correlated to the monetary base for as long as his firm, Paulson & Co., has tracked the data.
Given his expectation for further money printing by the Fed – and that in 1980 the gold price rose by 100% more than the correlation implied – Paulson noted that the price of gold could hit $2,400 based only on monetary expansion, and as high as $4,000 per ounce based on a projected overshoot.
Lastly, he noted that 80% of his assets are denominated in gold – a strong indication of his disdain for fiat currencies.
In terms of the gold price, Paulson pointed to gold’s parabolic rise in 1980 and his expectations of a repeat performance.
Read the complete article on Paulson at goldalert.com here.
At GuruFocus, we track the long equity positions of both Gurus, among many others (see the complete list here. According to the aggregated portfolio of the two, as of June 30, 2010, the two share 10 stocks ideas:
| Symbol | Company | # of Guru Buys Last Quarter | # of Guru Sells Last Quarter | Combined Weightings (%) |
| CNO | Conseco Inc. | 0 | 1 | 0.73 |
| BAC | Bank of America Corp. | 0 | 1 | 24.30 |
| C | Citigroup Inc. | 0 | 1 | 15.95 |
| HIG | The Hartford Financial Services Group In | 1 | 1 | 9.05 |
| WFC | Wells Fargo & Company | 0 | 1 | 9.01 |
| PFE | Pfizer Inc | 2 | 0 | 7.06 |
| STI | SunTrust Banks Inc. | 0 | 1 | 6.96 |
| COF | Capital One Financial Corp. | 0 | 1 | 5.50 |
| SPMD | Idearc Inc. | 0 | 1 | 0.53 |
| BEE | Strategic Hotels & Resorts Inc. | 2 | 0 | 0.34 |
A brief review of the first five stocks:
Conseco Inc. (CNO, Financial)
CNO Financial Group, Inc. is a holding company for a group of insurance companies operating throughout the United States that develop, market and administer supplemental health insurance, annuity, individual life insurance and other insurance products. Conseco Inc. has a market cap of $1.39 billion; its shares were traded at around $5.54 with a P/E ratio of 7.5 and P/S ratio of 0.3.
Paulson owns 16,329,873 shares as of 06/30/2010, which accounts for 0.36% of the $22.7 billion equity portfolio of Paulson & Co..
Tepper owns 1,126,195 shares as of 06/30/2010, a decrease of 30.22% of from the previous quarter. This position accounts for 0.19% of the $2.87 billion equity portfolio of Appaloosa Management.
Bank of America Corp. (BAC, Financial)
Bank of America Corp. is one of the world's financial services companies. Bank Of America Corp. has a market cap of $132.85 billion; its shares were traded at around $13.24 with and P/S ratio of 0.9. The dividend yield of Bank Of America Corp. stocks is 0.3%.
Paulson owns 167,794,229 shares as of 06/30/2010, which accounts for 10.62% of the $22.7 billion equity portfolio.
Tepper owns 27,349,699 shares as of 06/30/2010, which accounts for 13.68% of the $2.87 billion equity portfolio.
Citigroup Inc. (C, Financial)
Citigroup Inc., the global financial services company. Citigroup Inc. has a market cap of $112.14 billion; its shares were traded at around $3.87 with and P/S ratio of 1.2.
Paulson owns 506,700,000 shares as of 06/30/2010, which accounts for 8.39% of the $22.7 billion equity portfolio.
Tepper owns 57,783,144 shares as of 06/30/2010, which accounts for 7.56% of the $2.87 billion equity portfolio.
The Hartford Financial Services Group In (HIG, Financial)
Hartford Financial Services is one of the nation's largest investment and insurance companies. The Hartford Financial Services Group In has a market cap of $10 billion; its shares were traded at around $22.5 with a P/E ratio of 5.4 and P/S ratio of 0.4. The dividend yield of The Hartford Financial Services Group In stocks is 0.9%.
Paulson owns 44,000,000 shares as of 06/30/2010, an increase of 245.1% from the previous quarter. This position accounts for 4.29% of the $22.7 billion equity portfolio.
Tepper owns 6,181,233 shares as of 06/30/2010, which accounts for 4.76% of the $2.87 billion equity portfolio.
Wells Fargo & Company (WFC, Financial)
Wells Fargo & Company is a diversified financial services company. Wells Fargo & Company has a market cap of $133.61 billion; its shares were traded at around $25.53 with a P/E ratio of 15.1 and P/S ratio of 1.4. The dividend yield of Wells Fargo & Company stocks is 0.8%. Wells Fargo & Company had an annual average earning growth of 5.1% over the past 10 years.
Paulson owns 17,500,000 shares as of 06/30/2010, which accounts for 1.97% of the $22.7 billion equity portfolio.
Tepper owns 7,901,200 shares as of 06/30/2010, which accounts for 7.04% of the $2.87 billion equity portfolio.
Not surprisingly, the stock ideas shared by Paulson and Tepper are mostly financials.
Check out Paulson’s complete equity portfolio here: http://www.gurufocus.com/ListGuru.php?GuruName=John+Paulson
Check out Tepper’s complete equity portfolio here: http://www.gurufocus.com/ListGuru.php?GuruName=David+Tepper
Check out the aggregated portfolio of the two here: http://www.gurufocus.com/gurutrac/holding_stat.php
GuruFocus provides real time information and insights of Investment Gurus such as Warren Buffett, John Paulson and David Tepper, for Premium Members. If you are not a premium member, click here to sign up or upgrade. 7-Day Free Trial is available.
