Billionaire Glenn Dubin’s Small Cap Picks Include United Rentals, Inc. (URI)

Wealth management company SEI Investments Company (NASDAQ:SEIC) was another of Dubin’s small cap picks as the filing disclosed ownership of 2.7 million shares. In its last quarterly report, revenue was up by 14% compared to the first quarter of 2012 and this helped drive more than a 40% increase in earnings. The stock carries trailing and forward P/E multiples of 22 and 16, respectively, so markets have already accounted for some future growth, but it might be worth looking into SEI Investments Company (NASDAQ:SEIC) to see if it can continue to see double-digit growth for the next few years.

Highbridge owned 1.8 million shares of Echostar Corporation (NASDAQ:SATS), a $3.4 billion market cap provider of digital set-top boxes, as of the beginning of April. Adjusted earnings numbers at the company appear to be in decline, and the stock trades at over 100 times forward earnings estimates as the sell-side is not particularly optimistic on EchoStar; there is a wide range of forecasts but even the high estimate calls for less than $1 per share for a company whose current stock price is over $30. Revenue numbers have been up only slightly.

We would therefore stay away from Echostar Corporation (NASDAQ:SATS) as well as Ctrip.com International, Ltd. (ADR) (NASDAQ:CTRP). The other three companies we’ve covered here are highly dependent on future growth. While certainly not value plays at these levels, United Rentals, Inc. (NYSE:URI) and SEI have been delivering impressive results recently and so they could be worth checking out to see how sustainable that performance is. Cosan Limited (USA) (NYSE:CZZ) is a possibility as well for investors who are bullish on Brazil and/or sugar cane ethanol.

Disclosure: I own no shares of any stocks mentioned in this article.