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True Alpha - Top Holdings of Highest-Earning Guru David Tepper

May 06, 2013 | About:
Sally Jones

Sally Jones

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[/b][b]“Explosions of greatness” Guru David Tepper, founder of Appaloosa Management, is an inspired investor-philanthropist that began this year bullish, with the qualifier, “I’m never bullish.” Outlining the catalysts for growth in 2013 on Bloomberg Television, Tepper said that he expected a shift of new money with incremental funds moving into the equity market, supported by an economy improving two to three percent and a trillion dollars a year from the Fed. Tepper’s belief is that “Money will find the spots that are cheaper.” Given that sage outlook, here’s an update of David Tepper’s top four holdings and how they are performing: [/b]

No. 1: Apple Inc. (AAPL), Weightings: 10.5%, Shares Owned: 912,661, Value: $486 million

Apple Inc. (AAPL) is remaining shareholder friendly. To address its tumbling share price, last week AAPL issued a $17 billion dollar bond that hopes to return $100 million to its shareholders, according to Reuters.

Guru David Tepper has been holding AAPL since the first quarter of 2011 when he bought on average at $345.68 per share. As of the quarter ending Dec. 31, 2012, David Tepper last bought 391,473 shares for an average price of $489.17 per share for a 6% loss. Currently, Tepper owns 912,661 shares of AAPL, valued as $486 million, and accounts for 10.5% of his equity portfolio. Tepper increased his position most recently in the Dec. 31, 2012 quarter by 75.11%.

Currently Appaloosa Management’s top public equity holding, Apple Inc. has a market cap of $428.8 billion; its shares traded around $456.4 with a P/E ratio of 10.41 and P/S ratio of 2.6. The dividend yield of Apple Inc. stocks is 1.8%. Apple Inc. had an annual average earnings growth of 81.6% over the past 10 years.

His holding history:



Down 19% over 12 months, Apple Inc. is a California corporation founded in 1977. Apple Inc. has a market cap of $428.99 billion; its shares were traded around $461.03 with a P/E ratio of 11.30 and a P/S ratio of 2.62. The dividend yield of Apple Inc. stocks is 1.80%. Apple Inc. had an annual average earnings growth of 64.1% over the past 10 years.

Here’s the GuruFocus Interactive Valuation Analysis for APPL:



AAPL data by GuruFocus.com

No. 2: Citigroup Inc. (C), Weightings: 7.9%, Shares Owned: 9,194,547, Value: $363 million

In mid-April, Citigroup Inc. reported net income for the first quarter of 2013 as $3.8 billion, or $1.23 per diluted share, on revenues of $20.5 billion. This compared to a net income of $2.9 billion, or $0.95 per diluted share, on revenues of $19.4 billion for the first quarter 2012.

As of the quarter ending Dec. 31, 2012, David Tepper last traded C shares, selling 1,000,000 shares at an average price of $36.66 per share for a 30.2% loss. Currently, Tepper owns 9,194,547 shares of Citigroup, valued around $363 million. This holding accounts for 10.5% of his equity portfolio.

Currently Appaloosa Management’s second top public equity holding, Citigroup is up 51% over twelve months. Citigroup Inc. was incorporated in 1988 and has a market cap of $144.19 billion; its shares were traded at around $47.89 with a P/E ratio of 19.30 and a P/S ratio of 2.0. The dividend yield of Citigroup Inc. stocks is 0.1%.

His holding history:



Here’s the GuruFocus Interactive Valuation Analysis for Citigroup:



C data by GuruFocus.com

No. 3: American International Group Inc. (AIG), Weightings: 4.6%, Shares Owned: 6,059,000, Value: $213 million

Several days ago, American International Group, Inc. (AIG) reported its net income for first quarter is down $1 billion, compared to the same quarter last year. The company reported a net income of $2.2 billion and after-tax operating income of $2.0 billion for the quarter ended March 31, 2013, compared to a net income of $3.2 billion and after-tax operating income of $3.0 billion for the first quarter of 2012.

As of the quarter ending Dec. 31, 2012, David Tepper last traded AIG shares, selling 2,191,000 shares at an average price of $34.08 per share for a 34% gain. Currently, Tepper owns 6,059,000 shares of AIG, valued around $213 million. This holding accounts for 4.6% of his equity portfolio.

His holding history:



Up 43% over 12 months, property and casualty insurer American International Group Inc. (AIG) shares are up 20% over 12 months. The company has a market cap of $63.79 billion. Its key ratios are a P/E of 30.80, a P/B of 0.60 and a P/S of 1.10.

Here’s the GuruFocus Interactive Valuation Analysis for AIG:



AIG data by GuruFocus.com

No. 4: United Continental Holdings Inc. (UAL), Weightings: 4.6%, Shares Owned: 9,118,613, Value: $213 million

An enthusiastic proponent of commercial flying, David Tepper started the year saying that the U.S economy had tail winds. But his fourth top holding, United Continental is suffering from a lack of economic push. United Continental (UAL) recently reported a first quarter 2013 net loss of $417 million, or $1.26 per share. However, the company reported its best first quarter for on-time performance in a decade, with 81% percent of mainline flights arriving within 14 minutes of the scheduled arrival time.

As of the quarter ending Dec. 31, 2012, David Tepper last traded UAL shares, selling 700,352 shares at an average price of $20.91 per share for a 60.3% gain. Currently, Tepper owns 9,118,613 shares of UAL, valued around $213 million. This holding accounts for 4.6% of his equity portfolio.

His holding history:



Up 42% over 12 months, United Continental Holdings Inc. is a Delaware corporation, founded on Dec. 30, 1968. United Continental Holdings Inc. has a market cap of $11.01 billion; its shares were traded at around $33.57 with a P/B ratio of 23.30 and P/S ratio of 0.30.

Here’s the GuruFocus Interactive Valuation Analysis for UAL:



UAL data by GuruFocus.com

Guru David Tepper was named by Forbes recently as the highest earning among the top 40 hedge fund managers and traders. Tepper personally made $2.2 billion in 2012. Tepper’s hedge fund, Appaloosa Management, had net returns of almost 30% last year, with an average annual return of 23.3% over five years, and 29.2% since inception in 1993. His portfolio lists 57 stocks with a total value of $4.6 billion, and a quarter-over-quarter turnover of 22%.



Here is the complete portfolio of David Tepper.

1. David Tepper's Undervalued Stocks

2. David Tepper's Top Growth Companies

3. David Tepper's High Yield stocks

4. Stocks that David Tepper keeps buying

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About the author:

Sally Jones
Sally Jones writes about Real Time Picks. She says, "I truly enjoy watching the Gurus in realtime and telling their story."

Rating: 3.1/5 (7 votes)

Comments

mocheng
Mocheng premium member - 11 months ago
Thanks for the article, I am a huge fan of David Tepper, and his calls on the market has been right on the spots recent years.
Sally Jones
Sally Jones - 11 months ago
Thank you very much. He really is an amazing Guru in so many ways! And he can sing!

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