The latest 13F season is here, when many money managers issue required reports on their holdings. It can be worthwhile to pay attention, as you might get an investment idea or two by seeing what some major investors have been buying and selling.
For example, consider highly regarded value investor David Einhorn and Greenlight Capital, which he founded. Einhorn's investing success and advocacy of financial transparency and accountability have attracted many fans. Although he isn't afraid to short stocks, he prefers going long, looking for situations where he feels a stock is mispriced. He started Greenlight with less than a million dollars, and it now boasts a stock portfolio worth $6.7 billion.
Greenlight Capital's latest 13F report shows that it bought American Capital Agency Corp. (AGNC 0.76%), Nokia Corporation (NOK 0.39%), and SunEdison (SUNEQ).
American Capital Agency is a mortgage REIT with a tantalizing dividend yield recently above 11%. Its payout has been shrinking in recent years, though. The company has been trying to become more of an asset manager than an owner and has raised some eyebrows with some of its moves, such as buying stock in its rivals. Its strategies have been paying off, though, as is evident from its solid first-quarter results, which were helped by a drop in mortgage-market volatility.
Finland-based Nokia, once a telecom equipment powerhouse, has struggled in recent years but seems to be turning itself around. A Jefferies analyst recently upgraded it to Buy, seeing a 35% upside to the stock. Nokia has sold its handset business to Microsoft for about $7 billion, and among other initiatives, is moving into the connected-car arena, aiming for a piece of the Internet of Things pie. The cash from the big sale will go a long way toward paying down debt, and may result in dividends and share buybacks, as well. Fool analysts like Nokia's shift from devices toward networking, as it's likely to be more profitable.
SunEdison is a solar-power company. Bulls like its project pipeline and positive momentum in the solar industry, but its cash flow and liquidity leave much to be desired. Indeed, its net losses have been growing in recent years, while free cash flow has been increasingly negative. Its last quarter featured bigger-than-expected losses, in part due to falling prices for solar panels. Analysts at TheStreet recently downgraded the stock from hold to sell, while Goldman Sachs lowered it from "conviction buy" to buy. As is often the case, opinions are quite divided on Wall Street.
