David Tepper

David Tepper

Last Update: 02-14-2017

Number of Stocks: 54
Number of New Stocks: 21

Total Value: $5,640 Mil
Q/Q Turnover: 38%

Countries: USA
Details: Top Buys | Top Sales | Top Holdings  Embed:

David Tepper' s Profile & Performance

Profile

David Alan Tepper is the founder of Appaloosa Management, which is a $3 billion hedge fund investment firm based in Chatham, N.J., just west of New York City. David Tepper initially became interested in the stock market as a young boy watching his father trade stocks in his hometown of Pittsburgh. Today, as president and founder of Appaloosa Management, Tepper has earned an international reputation for producing some of the highest returns amongst fund managers on Wall Street. He earned a master of science in industrial administration from Carnegie Mellon in 1982. He donated a record $55 million to the Graduate School of Industrial Administration. The gift is the largest donation to Carnegie Mellon University in its 104-year history.

Investing Philosophy

He is a distressed-debt specialist, was once considered to be the hottest investor on wall street.

Total Holding History

Performance of Appaloosa Investment LP I

YearReturn (%)S&P500 (%)Excess Gain (%)
20142.2813.69-11.4
201342.3632.3910.0
201229.291613.3
3-Year Cumulative88.3 (23.5%/year)74.6 (20.4%/year)13.7 (3.1%/year)
2011-3.532.11-5.6
20102215.066.9
5-Year Cumulative121.6 (17.2%/year)105.1 (15.5%/year)16.5 (1.7%/year)
2009132.7226.46106.3
2008-26.72-3710.3
20078.885.493.4
200625.8615.7910.1
200520.554.9115.6
10-Year Cumulative524.2 (20.1%/year)109.4 (7.7%/year)414.8 (12.4%/year)
200433.8110.8822.9
2003148.8228.68120.1
2002-24.8-22.1-2.7
200166.75-11.8978.6
20000.04-9.19.1
15-Year Cumulative2507 (24.3%/year)86.4 (4.2%/year)2420.6 (20.1%/year)
199960.8921.0439.8
1998-29.1928.58-57.8
199729.5433.36-3.8
199678.4622.9655.5
199542.0637.584.5
20-Year Cumulative9654.1 (25.7%/year)554.6 (9.8%/year)9099.5 (15.9%/year)
199419.031.3217.7
199357.6210.0847.5

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During the most recent quarter, world-renowned investor David Tepper (Trades, Portfolio) showed staunch conviction on Allergan while adding just two new positions to his Appaloosa Management portfolio. Read more...
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After a brutal six months, David Tepper (Trades, Portfolio)’s 11% stake in Terraform Power Inc. is swinging to a profit after it issued a statement Thursday that the bankruptcy of SunEdison (SUNE), its sponsor company, would not materially impact its business. Read more...
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How David Tepper Became a Billionaire

Several major deals highlighted David Tepper’s career before he established his fame by making the all-time record payday of $4 billion investing in near-bankrupt banks in 2009. The distressed debt specialist actually made his all-time record return of 148% back in 2003 and has had a 30% average annualized return since he founded his firm, Appaloosa Management, in 1993.

Tepper primarily specializes in distressed debt investing. He tends to buy distressed debt of companies on the verge of implosion and sells it when it matures. His firm now manages about $4 billion.

Power Companies (2001-2004)

Tepper’s assurance that the government would not let banks fail had at least one precedent. He made a small fortune in 2004 in a similar situation during the California electricity crisis. In 2000 and 2001, large swaths of the state of California faced blackouts and prominent electricity companies went bankrupt. The disaster began when energy companies created an artificial shortage by shutting down power plants for maintenance during times of peak usage. They then increased the price, allowing traders to sell power at significantly higher rates.

The government had also placed a price cap on retail electricity charges, which forced the industry to sell electricity at a loss. Drought and population growth in California exacerbated the situation. Consequently, Pacific Gas and Electric Company (PCG) went bankrupt, and Southern California Edison nearly went bankrupt as well.

The state of California stepped in to save the dying companies, which had together accumulated $20 billion of debt by early 2001 and had their credit ratings reduced to junk status. On January 2001, the state authorized the California Department of Water and Resources to buy power for Southern California Edison, and later it did the same for SDG&E. Companies resumed purchasing their own power in 2003.

David Tepper bought millions of shares of the two most affected power companies, Pacific Gas and Electric and Edison International (EIX), from 2001-2003, mostly when their stock traded in the teens or lower. He sold out of both companies in the beginning of 2004, when their stock had risen to the mid-$20s.

Enron, Worldcom, Conseco Bankruptcies (2002-2004)

In 2002 Tepper purchased at least $1 billion of the $14 billion of distressed debt and securities of one company that went bankrupt in the fallout of the energy crisis – Enron. Enron was accused of gaming the energy market and collapsed due to unethical bookkeeping and other causes.

Another company’s epic bankruptcy that year that paid off for Tepper. Worldcom concealed losses and misled the public about earnings, causing bond investors to lose about $7.6 billion when it defaulted on its debt, which Tepper purchased. “I’m buying a little bit today. It’s a big company with a lot of revenue so we probably will end up making money,” Tepper told the Seattle Times.

Conseco Inc., a U.S. insurance company that filed Chapter 11 bankruptcy in 2003, canceled its stock and gave ownership of the company in large part to bondholders. Tepper bought a large amount of cheap Conseco bonds when it was on the brink of bankruptcy. Conseco emerged from bankruptcy in 2003.

In 2003, Tepper returned 148% and in 2004, he was the second highest paid hedge fund manager, making $510 million, according to Institutional Investor.

Banks (2009)

Tepper’s seminal trades were made in 2009. Similar to John Paulson, he bought into financials confident that the government would not let the largest banks fail. While banks were teetering on the brink of bankruptcy and the majority of investors were believing the government would nationalize them, Tepper amassed bank-related securities, such as common and preferred shares and junior-subordinated debt.

In the first quarter of 2009, he bought 47.55 million shares of Bank of American at an average price of $6.73 per share. He then decreased his stake steadily as the stock rallied, reaching an average price of $15.79 in the fourth quarter of 2009.

He bought Bank of America preferred shares at 12 cents on the dollar and Citigroup bonds at 19 cents, and other bank debt of Washington Mutual and common and preferred shares of Wachovia, NBC reported. By the end of 2009, the companies’ stocks had recovered and he made billions.

In 2009 he made the highest payday in history of $4 billion, and achieved his second highest return of 132.7%.

Housing (2011)

With few large companies or sectors going under, Tepper has turned to one of the most distressed industries available – housing. He bought KB Homes (KBH), D.R. Horton Inc. (DHI), Pulte Group Inc. (PHM), Beazer Homes USA Inc. (BZH), Ryland Group Inc. (RYL), and Masco Corp. (MAS) in the first quarter of 2011.

Though none of the companies have balance sheets that forebode bankruptcy and none have announced an intention to, their stocks are cheap. The once-thriving companies now sell in the teens or lower.

Tepper is profiting less from disaster in the first quarter. His top five holdings are Citigroup (C), Prizer Inc. (PFE), Hewlett Packard Co. (HPQ), Bank of America Corp. (BAC), Goodyear Tire & Rubber (GT).

Commentaries and Stories

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Rating: 3.0/5 (2 votes)

Behind the Bill Ackman Controversies The man, company and investing philosophy that have made Ackman and Pershing Capital No. 3 on the GuruFocus Score Board for 10-year performance Bill Ackman,David Tepper,Prem Watsa,Seth Klarman,W - Behind The Bill Ackman Controversies
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GURUS, INVESTING GURUS, BILL ACKMAN, PERSHING SQUARE, INVESTMENT PHILOSOPHY, VALUE INVESTING, VALUE INVESTOR, HERBALIFE, VALEANT, CANADIAN PACIFIC, HIGH-QUALITY BUSINESSES, LONG, SHORT


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Risk-Reward With Teva Pharmaceutical With the stock down close to 40% over the last year, is it a buy or a value trap? David Tepper - Risk-Reward With Teva Pharmaceutical
As two of its largest guru shareholders, John Paulson (TradesPortfolio) and David Tepper (TradesPortfolio) are dead wrong on Teva Pharmaceutical Industires Ltd. (NYSE:TEVA). Teva is a value trap even if the stock had a short-term price pop. Paulson owns 15.9 million shares, good for 7.36% of his portfolio, while Tepper owns 5.05 million shares, good for 3.25% of his total assets managed. More...

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The Most Attractive Value Stock There Is? These value investors love Allergan Carl Icahn,David Tepper - The Most Attractive Value Stock There Is?
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Rating: 5.0/5 (6 votes)

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David Tepper Discusses Interest Rates, GOP Plans, Border Tax Tepper addressed several economic topics David Tepper - David Tepper Discusses Interest Rates, GOP Plans, Border Tax
David Tepper (Trades, Portfolio), the famed founder of Appaloosa Management, spoke on CNBC Wednesday morning about the direction of the U.S. economy and market under the GOP's plans and the possibility of a Fed rate hike. More...

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Rating: 5.0/5 (4 votes)

David Tepper Discusses Allergan Investment, Market Valuation Tepper thinks the market is fully valued but has other factors going for it David Tepper - David Tepper Discusses Allergan Investment, Market Valuation
Appaloosa Management founder David Tepper (Trades, Portfolio) discussed his investment in pharma stocks in an interview with CNBC Wednesday morning. Tepper particularly favors Allergan (NYSE:AGN) due to its attractive valuation following Valeant (NYSE:VRX)'s trouble, which affected the sector. Tepper also discussed his assessment of market valuations and the global economy. More...

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David Tepper Bought Snap and Would Buy More Tepper discussed social media investment in CNBC interview David Tepper - David Tepper Bought Snap And Would Buy More
David Tepper (Trades, Portfolio), Appaloosa Management leader, said he bought Snap Inc. (NYSE:SNAP) at its IPO and said he would sell if it went high into the $20s. He also said he was not excited about it at $21.80 per share but would accumulate more if it fell back to its IPO price. Tepper said he believes the demographic for the app would expand to older people as it positions itself to benefit from an "anti-Facebook" attitude amoung young people. More...

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David Tepper Invests Heavily in Pharma in 4th Quarter Guru gains 4 drug manufacturers, adds to Allergan David Tepper,Barow Hanley Mewhinney & Strauss,Vang - David Tepper Invests Heavily In Pharma In 4th Quarter
David Tepper (Trades, Portfolio), founder and president of Appaloosa Management, gained new holdings in pharmaceutical companies in the final quarter of 2016. More...

TEPPER, APPALOOSA, BUYS, 4Q, PHARMA


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David Tepper Exits Community Health Systems The company's operating margin has been in long-term decline and it has a high short percentage of float David Tepper - David Tepper Exits Community Health Systems
Guru David Tepper (Trades, Portfolio) sold his remaining 6,270,130 shares of Community Health Systems (NYSE:CYH) during the third quarter. The trade had a -1.99% impact on Tepper’s portfolio. More...

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Have You Heard of the 'Cheap Optionality' Strategy? An independent retail trader used it to turn $46,000 into $6.8 million in 28 months David Tepper - Have You Heard Of The 'Cheap Optionality' Strategy?
It probably didn’t take long after becoming a trader to stumble upon options. Brokerages and Web sites all over the Internet are constantly pitching these complex financial derivatives, claiming things like “defined risk” and “100% returns a month.” But these advertisements only end up luring novices into a game that creates losses rather than stunning returns. More...

PROCESS


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David Tepper Expands Technology and Financial Empire High-performing guru buys 5 new companies in 3rd quarter David Tepper,Daniel Loeb,Steven Cohen,Warren Buffe - David Tepper Expands Technology And Financial Empire
David Tepper (Trades, Portfolio), founder of Appaloosa Management, has earned a reputation for producing top market returns among Wall Street guru investors. The distressed debt specialist primarily invests in companies at cheap prices and sells them as the stock price increases. More...

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Rating: 4.0/5 (2 votes)

David Tepper on Market Caution and Election's Impact Appaloosa manager shares thoughts on market direction David Tepper - David Tepper On Market Caution And Election's Impact
Appaloosa Management founder David Tepper (Trades, Portfolio) spoke with CNBC about his view of the markets. Tepper said the market is fairly to fully valued, that margins may be under pressure, and it is a difficult environment. More...

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David Tepper Pulls Half of Backing of Shell Company Formed From Washington Mutual Bankruptcy Tepper was the largest stakeholder David Tepper - David Tepper Pulls Half Of Backing Of Shell Company Formed From Washington Mutual Bankruptcy
David Tepper (Trades, Portfolio), founder of Appaloosa Management, withdrew some support for the shell company that emerged from the bankruptcy of Washington Mutual during the financial crisis as it struggles to find an acquisition. More...

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David Tepper Erases Delta Guru removes airline from portfolio David Tepper,Alan Fournier,Jim Simons - David Tepper Erases Delta
David Tepper (TradesPortfolio) sold out his 8,594,855 shares in Delta Air Lines (NYSE:DAL) for an average price of $42.61 per share in the second quarter. More...

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Alan Fournier Purchases Stake in Vonage Company provides a wide range of services to its customers Alan Fournier,David Tepper - Alan Fournier Purchases Stake In Vonage
Alan Fournier (Trades, Portfolio) purchased a 181,804-share stake in Vonage Holdings Corp. (VG) at an average price of $4.72 per share in the second quarter. More...

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David Tepper Exits Facebook, Boosts Allergan Guru's second quarter trades David Tepper - David Tepper Exits Facebook, Boosts Allergan
David Tepper (Trades, Portfolio) is the founder of Appaloosa Management, which is a $3 billion hedge fund investment firm based in Chatham, New Jersey. The following are his largest trades of the second quarter. More...

BUY, SELL, TEPPER, APPALOOSA


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T Boone Pickens Expands His Oil Empire Guru’s top 3 new holdings in oil, energy T Boone Pickens,David Tepper,Chuck Royce,Jim Simon - T Boone Pickens Expands His Oil Empire
During the second quarter, T Boone Pickens of BP Capital Fund Advisors LLC acquired three new holdings associated with the energy and oil and gas industries. They are Williams Partners LP (NYSE:WPZ), Newpark Resources Inc. (NYSE:NR) and PBF Logistics LP (NYSE:PBFX). More...

OIL, ENERGY, GAS, BOONE, PICKENS


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David Tepper Raises Bet on Allergan, Adds 2 New Positions in Latest Quarter Tepper made significant increase to Allergan David Tepper - David Tepper Raises Bet On Allergan, Adds 2 New Positions In Latest Quarter
During the most recent quarter, world-renowned investor David Tepper (Trades, Portfolio) showed staunch conviction on Allergan while adding just two new positions to his Appaloosa Management portfolio. More...

  • Currently 5.00/5

Rating: 5.0/5 (2 votes)

David Tepper’s Delta Investment Nosedives Uncertainty has 'over-punished' airline stocks but won't last David Tepper - David Tepper’s Delta Investment Nosedives
David Tepper (Trades, Portfolio)’s eye for a deal and airtight vision for companies and trends did not defend against the affect of the unexpected shakeup in the European Union on two of his 10 largest portfolio equities. More...

  • Currently 5.00/5

Rating: 5.0/5 (1 vote)

David Tepper Adds to Stake in Delta Air Lines Delta looks to be a solid investment for Tepper who has netted 26.7% for his Appaloosa fund since 1993 David Tepper,Seth Klarman,Bruce Berkowitz - David Tepper Adds To Stake In Delta Air Lines
Guru David Tepper (Trades, Portfolio), founder and president of Appaloosa Management LP, added 1,271,440 shares to his stake in Delta Air Lines Inc. (NYSE:DAL) during the first quarter. More...

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