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8 Stocks Billionaire John Paulson Loves

John Alfred Paulson, president of Paulson & Co., Inc.
TimSloan | AFP | Getty Images
John Alfred Paulson, president of Paulson & Co., Inc.

At Stockpickr, we track the top 30 holdings of various mutual funds, hedge funds and super-investors, such as George Soros and Carl Icahn.

One of our most popular portfolios is that of John Paulson’s Paulson & Co.

Paulson tied for 61st in Forbes’ recently released list of the world’s billionaires.

In the fourth quarter, according to Paulson & Co.’s most recent 13F filing with the Securities and Exchange Commission, the fund sold out of several positions, including Bank of America, News Corp., Citigroup, and Hewlett-Packard.

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But what did the billionaire buy? Here’s a look at eight stocks that Paulson bought in the fourth quarter and that are part of the top 30 holdings tracked on Stockpickr.

8. Randgold Resources

Paulson & Co. increased its position in Randgold Resources by 15,700 shares, or 1.7 percent, in the fourth quarter to 938,700 shares.

Stock Overview: Randgold, together with its joint ventures, carries out exploration and gold mining activities, with two operating mines in Mali, West Africa: The Morila gold mine and the Loulo mine complex. It has a market capitalization of about $10 billion.

The stock, which yields 0.2 percent and has a short interest ratio of 1.5, has traded in a 52-week range of $70.18 to $120.73 and closed up $2.36, or 2.2 percent, at $111.66 on Thursday.

Analyst Ratings: Of eight analysts covering the stock, one rates it a “buy,” six rate it a “hold,” and one rates it a “sell.” TheStreet Ratings has a “buy” rating on the stock with a $136.87 price target.

7. El Paso

Paulson initiated a new four million-share stake in El Paso in the fourth quarter that comprises 0.8 percent of the Paulson & Co. portfolio.

El Paso shows up in various Stockpickr pro portfolios, including Carl Icahn’s, as the second-largest holding of Icahn Associates, with 72.3 million shares.

In addition, Steve Mandel’s Lone Pine Capital initiated a 6.6 million-share position, and Daniel Loeb’s Third Point holds 5.6 million shares as of the most recently reported quarter.

Stock Overview: El Paso operates in the natural gas transmission and exploration and production sectors of the energy industry. It has a market cap of about $22 billion.

The stock, which yields 0.1 percent and has a short interest ratio of 0.9, closed up 32 cents, or 1.1 percent, at $28.74 on Thursday after hitting a new 52-week high of $28.80 earlier in the day.

Analyst Ratings: Of eight analysts covering the stock, three rate it a “buy,” and five rate it a “hold.” TheStreet Ratings has a “B- buy” rating on El Paso with a $36.88 price target. El Paso was one of the 10 best-performing S&P 500 index stocks of 2011.

6. Medco Health Solutions

Pauslon & Co. increased its position in Medco Health Solutions by 1.3 million shares, or 186 percent, in the fourth quarter, to 2 million shares.

Medco is also a top holding of George Soros, whose Soros Fund Management also increased its position in the stock, to 526,620 shares.

Stock Overview: Medco is a health-care company that provides clinically driven pharmacy services designed to improve the quality of care and lower total health-care costs for private and public employers, health plans, labor unions, and more. It has a market cap of about $26 billion.

The stock, which has a short interest ratio of 1.2, has traded in a 52-week range of $44.60 to $69.10 and closed up 73 cents, or 1.1 percent, at $67.65 on Thursday.

Analyst Ratings: Of 18 analysts covering the stock, seven rate it a “buy,” 10 rate it a “hold,” and one rates it a “sell.” TheStreet Ratings has a “B buy” rating on Medco, with a $77.21 price target.

5. Goodrich

Paulson owned 1.4 million shares of Goodrich as of Dec. 31, 2011, an increase of 927,650 shares, or 185.5 percent, from the previous quarter. The stock comprises 1.3 percent of the Paulson & Co. portfolio.

Goodrich is also a top holding in Moore Capital’s portfolio, comprising 3.7 percent of the total, and D.E. Shaw increased its position in the stock by nearly 200 percent to 932,420 shares in the fourth quarter.

Stock Overview: Goodrich is a worldwide supplier of aerospace components, systems and services to the commercial and general aviation airplane markets. It also supplies systems and products to the global defense and space markets. It has a market cap of $15.8 billion.

The stock, which yields 0.9 percent and has a short interest ratio of 1.4, has traded in a 52-week range of $79.71 to $126.19 and closed up 17 cents at $126.09 on Thursday.

Analyst Ratings: Of 17 analysts covering the stock, 16 rate it a “hold,” and one rates it a “sell.”

TheStreet Ratings has an “A+ buy” rating on Goodrich, with a $165.39 price target.

4. NovaGold Resources

NovaGold Resources comprises 1.4 percent of the Paulson & Co. portfolio. In the fourth quarter, Paulson scooped up 2.75 million shares of the stock, increasing his position by 13.6 percent to 22.95 million shares.

He reportedly has increased his position again in the first quarter of 2012, to 29.95 million shares.

Other holders of NovaGold include Seth Klarman’s Baupost Group, with a 7.5 million-share position, and John Griffin’s Blue Ridge Capital, which maintained a 7.2 million-share position in the fourth quarter.

Stock Overview: NovaGold, through its wholly owned subsidiaries, partnerships, limited liability companies, and joint ventures, is engaged in the exploration and development of mineral properties in Alaska and British Columbia. It has a market cap of $2.1 billion.

The stock, which has a short interest ratio of 4.5, has traded in a 52-week range of $5.93 to $14.02 and traded up 10 cents, or 1.3 percent, to $7.83 on Thursday.

Analyst Ratings: Three analysts covering NovaGold rate it a “hold.” TheStreet Ratings has a “D sell” rating on the stock.

3. AMC Networks

Paulson & Co. owns 5.8 million shares of AMC Networks, an increase of 750,000 shares, or 15 percent, from the previous quarter. The stock comprises 1.6 percent of the Paulson & Co. portfolio as of the most recently reported quarter.

Stock Overview: AMC Networks owns and operates several popular and award-winning brands in cable television, including AMC, IFC, Sundance Channel, WE tv, and IFC Films. It has a market cap of $2.6 billion.

The stock, which has a short interest ratio of 3.7, closed up 26 cents at $44.56 on Thursday after hitting a new 52-week high of $44.89 earlier in the day.

Analyst Ratings: Of nine analysts covering the stock, four rate it a “buy,” three rate it a “hold,” and two rate it a “sell.”

2. Motorola Mobility Holdings

Paulson’s seventh-largest holding as of the fourth quarter, Motorola Mobility Holdings, comprises 3.1 percent of the Paulson & Co. portfolio. The fund increased its position in Motorola by two million shares, or 22 percent, to 11 million shares during the quarter.

Motorola Mobility is also one of Carl Icahn’s top holdings, comprising 10.1 percent of the Icahn Associates portfolio, and the top holding of Farallon Capital Management, which added 1.25 million shares in the quarter for a total of 11.8 shares.

Stock Overview: Motorola Mobility is a provider of innovative technologies, products, and services that enable a broad range of mobile and wireline, digital communication, information and entertainment experiences. It has a market cap of about $12 billion.

The stock, which has a short ratio or 1.7, has traded in a 52-week range of $20.77 to $39.81 and closed up 9 cents at $39.75 on Thursday.

Analyst Ratings: Of 27 analysts covering the stock, four rate it a “buy,” 20 rate it a “hold,” and three rate it a “sell.”

1. Delphi Automotive

Delphi Automotive was a new buy for Paulson in the fourth quarter, and a big one; the 51.7 million-share position comprises 8 percent of the Paulson & Co. portfolio, its third-largest holding.

Delphi was also a new buy for David Tepper’s Appaloosa Management, with a 229,240-share position, and David Einhorn’s Greenlight Capital, with 8.2 million shares.

Stock Overview: Delphi, a global vehicle components manufacturer, provides electrical and electronic, powertrain, safety and thermal technology solutions to the global automotive and commercial vehicle markets. It has a market cap of $9.85 billion.

The stock, which has a short interest ratio of 3.1, had traded in a 52-week range of $19.22 to $32.98 and closed up $1.69, or 5.6 percent, at $31.70 on Thursday.

Analyst Ratings: Of eight analysts covering the stock, seven rate it a “buy,” and one rates it a “hold.”

Additional News: US Unlikely to Block Medco/Express Merger: Report

Additional Views: Bill Ackman’s ‘Best Opportunity’ Now

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Disclosures:

TheStreet’s editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

Disclaimer

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