Editor’s Note: Related Tickers: Hess Corp. (NYSE:HES), Tim Hortons Inc. (USA) (NYSE:THI), Metlife Inc (NYSE:MET)
Billionaire and hedge fund manager David Tepper was recently reported to be buying shares of Metlife Inc (NYSE:MET). Mr. Tepper is the founder of Appaloosa Management which has produced gains that have made Mr. Tepper a billionaire and many fortunes for his investors. It’s easy to see why Mr. Tepper has been a buyer of MetLife shares because the stock appears undervalued. MetLife shares are trading significantly below book value, which is about $59.04 per share. It is also trading for just around 7 times earnings. This is nearly half of the average for the S&P 500 Index (SPY), which is currently trading for about 15 times earnings. Furthermore, this stock could start attracting a whole new group of income investors thanks to a recent increase in the dividend.
Buffett Disciple Jason Donville Weighs Energy Stocks (Bloomberg)
Jason Donville, whose fund has outperformed Canadian stocks for five years using Warren Buffett’s value investing strategy, is eyeing Pulse Seismic Inc. (PSD), Total Energy Services Inc. (TOT) and other energy stocks after the recent resources rout. “We’re sharpening our pencils on energy right now because it’s very bombed out and the summertime is a great time to go looking for bargains,” said Donville, chief executive officer at Donville Kent Asset Management Inc. in Toronto. His DKAM Capital Ideas Fund, a hedge fund with about C$70 million ($69.5 million) under management, has produced an average annual return of 24 percent since its inception in October 2008, compared with a 2.9 percent average return for the Standard & Poor’s/TSX Composite Index in the same period, according to Donville Kent’s website.
Activist hedge fund stirs the pot at Tim Hortons (Globe and Mail)
Tim Hortons Inc. (USA) (NYSE:THI) is under pressure from an activist investor that wants the company to pare back its U.S. growth and borrow billions to fund a share buyback. Boston-based Highfields Capital Management, which owns about 4 per cent of the coffee chain, said it met with management in mid-March to propose the strategies it believes will immediately boost earnings per share and increase shareholder value in the long-run. The hedge fund has also pressed management to spin out the company’s real estate assets into a real estate investment trust. Tim Hortons refused to comment on Highfields’ plan.
Netflix, Inc. (NFLX), Time Warner Inc (TWX) & Five Takeover Rumors And the Hedge Funds Who Own Them (Insider Monkey)
Billionaire activist Carl Icahn has taken a large stake in Netflix, Inc. (NASDAQ:NFLX) and there has been some speculation that he might push to sell the company. He owned 5.5 million shares as of the beginning of this year (find Icahn’s favorite stocks). Other analysts have claimed that Netflix, Inc. could be a target purchase for a large technology company such as Microsoft to help win the “living room wars” between different consumer devices. Netflix, Inc. (NASDAQ:NFLX)’s stock price has been very volatile over the past few years, and is quite expensive at present with a forward earnings multiple of 69.
Advisory firm recommends Hess shareholders elect new board members (Reuters)
Proxy advisory firm Glass Lewis told Hess Corp. (NYSE:HES)’s shareholders late on Tuesday they should vote to elect five new board members nominated by activist hedge fund Elliot Management. Hess has been under pressure from the hedge fund, which owns a 4.5 percent stake in the oil and gas company, to implement changes, including the election of independent directors to the board, to increase shareholder value. “We believe Elliott has submitted a compelling case to suggest the Hess board has been largely ineffective at overseeing current management,” Glass Lewis said in a note.
SAC, Viking Questioned in Grassley’s Medicare Rate Probe (Bloomberg)
SAC Capital Advisors LP and Viking Global Investors LP are being questioned by Senator Charles Grassley in his review of a possible leak of a U.S. government decision on payment reimbursements to health insurers. Grassley, an Iowa Republican, sent letters yesterday to the investment firms, asking about…
