Billionaire Leon Cooperman’s Long-Term Stock Picks
In this piece, we will take a look at Leon Cooperman's long term stock picks. If you want to skip our introduction to the billionaire hedge fund investor and the latest stock market news, then take a look at Billionaire Leon Cooperman's Long-Term Stock Picks: Top 5 Stocks.
Leon Cooperman is one of the most seasoned hands on Wall Street. Mr. Cooperman graduated from the Columbia Business School in 1967. Immediately after graduating, he would work for the famed Goldman Sachs investment bank and spend 22 years there and go on to head Goldman's lucrative Asset Management business division.
Leon Cooperman set up his hedge fund Omega Advisors in 1991. He would spend the next 17 years of his life managing capital for outside investors and then retire and convert the fund into a family office. Mr. Cooperman's time in the industry has yielded handsome dividends, making him one of the richest people in the world with a net worth that is currently estimated to sit at $2.8 billion according to Forbes Magazine.
Shifting gears to focus on his fund, Omega Advisors had a portfolio worth $1.9 billion as of Q3 2023 end. This marked a small $67 million increase over the past quarter, and on an annual basis, the portfolio has grown by roughly $500 million. His investment approach is quite a popular one on Wall Street and has been followed by seasoned financial bosses such as Warren Buffett of Berkshire Hathaway and Seth Klarman of Baupost Group. If you haven't guessed it by now, Leon Cooperman is another hedge fund billionaire who has relied on a time tested approach of value investing. Value investing, for those out of the loop, involves picking out the right stocks and then patiently waiting for their value to appreciate over a long time period. The key to successful value investing is to determine the fair value of a stock, often based on its ability to generate future cash flows that will be available to investors. Then, a margin of safety is determined, which measures the current share price against the fair value price to measure the potential of losses in case the bet goes haywire. Like Buffett and Klarman, Mr. Cooperman's hedge fund has also outperformed the S&P 500 through careful stock selection by delivering 12.5% in annual returns between 1991 and 2018.
On the personal front, Mr. Cooperman actually planned to become a dentist before switching careers. He also had 16 job offers laid out for him in 1966 - something that most fresh graduates would be envious of these days. Additionally, Cooperman actually turned down Goldman Sachs the first time around despite being offered a job. He would later go on and accept a position after the possibilities of compensation growth became clear. Value investing also sits at the heart of his strategies, with the investment guru unable to see the point of paying high multiples for firms, especially during today's fast paced product cycles.
Safe to say, Leon Cooperman has had a remarkable and memorable time on the stock market through a career that has allowed him to beat markets when most people were making losses. Naturally, it pays to listen to him, and when it comes to the future, Mr. Cooperman shared his thoughts during CNBC's Financial Advisor Summit in October 2023 when he outlined:
Yeah, I’m not making a seven year forecast. I’m not making a 10 year forecast. But what I’m saying is, you know, I don’t think the markets got much upside in the near term. Things change. You know, we have a lot to worry about. What happened in Middle East is a concern. It’s despicable what the Hamas did. And it’s hard not to imagine a strong response by Israel and that can become broader in nature. So you know, you gotta be very careful. You know, it’s not an easy call. And I think people on your program are not spending enough time talking about our fiscal situation. They’re all focused on inflation. But I think inflation is just one part of the issue. I think that focusing on our fiscal deficit would make a lot of sense. And I don’t know how we cure it. I really don’t. The numbers are so large. I’ve advocated for several years on your program, that as a nation, we have to coalesce around the question, what should the maximum tax rate be on wealthy people? Because that will define the revenue yield to the government and the government has to size themselves to that revenue yield.
So, as Mr. Cooperman remains cautionary about the market's upside, it pays to see which stocks he's refusing to sell. We took a look today, and some notable names are The AES Corporation (NYSE:AES), Microsoft Corporation (NASDAQ:MSFT), and Citigroup Inc. (NYSE:C).
Leon Cooperman of Omega Advisors
Our Methodology
To compile our list of Leon Cooperman's long term stock picks, we sifted through Omega Advisors' Q3 2023 SEC filings and picked out the stocks in which the firm has invested for the longest time periods.
Billionaire Leon Cooperman's Long-Term Stock Picks
10. Ashland Inc. (NYSE:ASH)
Omega Advisor's Q3 2023 Investment Value: $78.4 million
First Purchase: 2016
Ashland Inc. (NYSE:ASH) is a small chemicals company headquartered in Wilmington, Delaware. The firm has been struggling on the financial front as of late since it has missed analyst EPS estimates in all four of its latest quarters. Its third quarter saw Ashland Inc. (NYSE:ASH)'s revenue drop by 18% annually and the firm posted a $4 million net loss.
By the end of this year's second quarter, 28 out of the 910 hedge funds part of Insider Monkey's database had held a stake in Ashland Inc. (NYSE:ASH). In Q3, the firm's biggest shareholder was Ricky Sandler's Eminence Capital due to its $287 million stake.
Ashland Inc. (NYSE:ASH) joins Microsoft Corporation (NASDAQ:MSFT), The AES Corporation (NYSE:AES), and Citigroup Inc. (NYSE:C) in our list of Leon Cooperman's longest held stocks.
9. OneMain Holdings, Inc. (NYSE:OMF)
Omega Advisor's Q3 2023 Investment Value: $2.5 million
First Purchase: 2015
OneMain Holdings, Inc. (NYSE:OMF) is a loan underwriter and insurance company headquartered in Evansville, Indiana. Leon Cooperman held a stake in the firm from 2015 to 2017 and then bought the shares again during Q3 2022 to continue holding them to date.
During Q2 2023, 26 among the 910 hedge funds tracked by Insider Monkey were the firm's investors. OneMain Holdings, Inc. (NYSE:OMF)'s largest hedge fund shareholder in Q3 was Glen Greenberg's Brave Warrior Capital as it owned 5.2 million shares that were worth $212 million.
8. Alphabet Inc. (NASDAQ:GOOG)
Omega Advisor's Q3 2023 Investment Value: $85 million
First Purchase: 2015
Alphabet Inc. (NASDAQ:GOOG) is a diversified technology company with search engines, productivity, consumer electronics, cloud computing, video streaming, and other lucrative business divisions. Leon Cooperman has held a stake in the company for all quarters since Q3 2015 except for Q2 2020.
Insider Monkey dug through 910 hedge fund portfolios for 2023's June quarter and found that 152 had bought and owned Alphabet Inc. (NASDAQ:GOOG)'s shares. In the succeeding quarter, Ken Fisher's Fisher Asset Management was the firm's biggest investor due to its $5.7 billion investment.
7. Arbor Realty Trust, Inc. (NYSE:ABR)
Omega Advisor's Q3 2023 Investment Value: $36.1 million
First Purchase: 2014
Arbor Realty Trust, Inc. (NYSE:ABR) is an American real estate investment trust that owns residential and commercial properties. It's another Leon Cooperman long term stock pick as the billionaire has continually owned the shares since 2015. However, Q3 2023 saw him reduce his holdings in Arbor Realty Trust, Inc. (NYSE:ABR) by 32%.
During the prior quarter, 12 out of the 910 hedge funds profiled by Insider Monkey had held a stake in the company. Arbor Realty Trust, Inc. (NYSE:ABR)'s largest shareholder during Q3 was Leon Cooperman's Omega Advisors since, despite the hefty reduction, it still owned 2.3 million shares that were worth $36.1 million.
6. Motorola Solutions, Inc. (NYSE:MSI)
Omega Advisor's Q3 2023 Investment Value: $27.2 million
First Purchase: 2012
Motorola Solutions, Inc. (NYSE:MSI) is an American firm that provides hardware and software products used for security, communications, and other purposes. Mr. Cooperman has held a stake in the firm in all quarters since Q1 2012 except for Q4 2016. In a classical tale of value investing, Motorola Solutions, Inc. (NYSE:MSI)'s average share price has grown from $48.62 back then to $284 as of Q3 2023.
As of Q2 2023, 43 hedge funds out of the 910 that were part of Insider Monkey's database have bought and owned Motorola Solutions, Inc. (NYSE:MSI)'s shares. In the next quarter, the biggest investor was William B. Gray's Orbis Investment Management courtesy of its $290 million investment.
The AES Corporation (NYSE:AES), Motorola Solutions, Inc. (NYSE:MSI), Microsoft Corporation (NASDAQ:MSFT), and Citigroup Inc. (NYSE:C) are some top Leon Cooperman long term stock picks.
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Disclosure: None. Billionaire Leon Cooperman's Long-Term Stock Picks is originally published on Insider Monkey.
