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‘Investors Get Paid Handsomely’ with This Stock: Mike Murphy

Friday, 23 Mar 2012 | 2:42 PM ET

As economic conditions improve, Mike Murphy of Rosecliff Capital expects private equity to shine. But how’s he playing it?

“I’m a buyer of KKR ,” he reveals to the Fast Money team. “I bought shares around $14.20. I think the company is in the sweet spot."

Time for PE to Shine?
Mike Murphy, Rosecliff Capital, explains that as economic conditions improve, private equity firms will benefit.

Here’s his thesis:

When the economy took a turn down, private equity was able to buy companies at a discount.

But now as the economy recovers and the appetite for IPO’s increase, they’ll be able to spin off.

“In the case of KKR, they’re bringing Toys R Us back to the public."

But there's more. Murphy also likes the yield. "They provide a great dividend yield of 9%,” he explains.

In other words not only is the stock a play on the recovery, but it pays you while you wait. “I think you get paid handsomely to be in this stock,” Murphy says.

Trader Patty Edwards likes the thesis. “I think Mike is right on with the concept,” she says. However she’s playing it long BKCC.







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Trader disclosure: On Mar 23, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Joe Terranova is long VRTS; Joe Terranova is long NXPI; Joe Terranova is long IBM; Joe Terranova is long MCD; Joe Terranova is long EMC; Joe Terranova is long MSFT; Joe Terranova is long JOY; Joe Terranova is long OXY; Joe Terranova is long LQD; Joe Terranova is long POT; Joe Terranova is long TBT; Steven Weiss is long JPM; Steven Weiss is long SNDK; Steven Weiss is long BRCM; Steven Weiss is long QCOM; Steven Weiss is long BAC; Steven Weiss is long NAV; Steven Weiss is long WLP; Steven Weiss is long HAIN; Steven Weiss is long TBT; Steven Weiss is long TBF; Steven Weiss is short X; Steven Weiss is short FXA; Steven Weiss is short FCP; Steve Grasso is long ANR; Steve Grasso is long ASTM; Steve Grasso is long AVAV; Steve Grasso is long BA; Steve Grasso is long D; Steve Grasso is long FRO; Steve Grasso is long MHY; Steve Grasso is long NUAN; Steve Grasso is long MO; Steve Grasso is long PFE; Steve Grasso is long PRST; Steve Grasso is long S; Steve Grasso is long XLU; Steve Grasso is long ZAZA; Patty Edwards is long for clients AAPL; Patty Edwards is long for clients BKCC; Patty Edwards is long for clients JWN; Patty Edwards is long for clients GLD; Patty Edwards is long for clients ED; Patty Edwards is long for clients EXC; Patty Edwards is long for clients INTC; Patty Edwards is long for clients JOY; Patty Edwards is long for clients SBUX; Patty Edwards is long for clients VLO; Patty Edwards is long for clients AMZN; Patty Edwards is long for clients NKE; Patty Edwards is long for clients HLF; Patty Edwards is long for clients PM; Patty Edwards is long for clients CBI; Patty Edwards is long PM

Dan Dicker
Dan Dicker is long RDS
Dan Dicker is long BHI

Nicole Miller Regan
The following companies have been investment banking clients of Piper Jaffray during the past 12 months: BBR
The following companies have been investment banking clients of Piper Jaffray during the past 12 months: GMCR
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