Stockpickr: Top Hedge Fund Stock Picks

One of DMO Capital's positions is Loews(LTR Quote). Here's the fund's reasoning behind holding this name:

It has cash on the balance sheet; a weak dollar will help hotel sales; it's the holding company of [other public companies] Boardwalk Pipeline Partners(BWP Quote), CNA Financial(CNA Quote), Carolina Group(CG Quote) and Diamond Offshore Drilling(DO Quote).

We see strength in all aspects of cash flow and value Loews [earnings per share] at $4.25 on a discounted basis, while only including earnings from Boardwalk Pipeline Partners, CNA Financial, Carolina Group and Diamond Offshore Drilling, and excluding earnings from hotel operations, Bulova and other cash-generating endeavors. [Also, on] Jan. 30, 2007, Diamond Offshore Drilling announced a special dividend of $4 per share payable on March 1, 2007, to shareholders of record Feb. 14, 2007.

In addition, it looks like DMO Capital is anticipating Harrah's Entertainment(HET Quote) will get bought out by a higher price than private equity firm Apollo Management's $90 a share offer. Here are DMO's comments on Stockpickr:

Apollo buys out of $90 a share. Updated Feb. 2, 2007: Harrah's filed an extension until Feb. 28, 2007, to make its decision on who is buying it out. Since Goldman is helping the deal now, we assume the offer will be north of $90 and have been planning accordingly (buying January 2008 call options aggressively). In the world of mergers and acquisitions, cash flow is king and Harrah's has cash flow.

Small-cap fund Freeway Capital recently posted an interesting pick on Stockpickr to take advantage of increasing fears about pollution and global warming. The company, Climate Exchange, trades on the Alternative Investments Market (AIM) portion of the London Stock Exchange, but also has an ADR in the U.S. under the symbol CXCHF. Here are Freeway's comments on Climate Exchange:

This is a company traded on the AIM in Britain, the leading carbon credit exchange in the world. Global warming is happening. It will continue to be a key policy issue. It is not going away. Goldman Sachs owns a large chunk of this company, and Morgan Stanley is spending billions -- not millions -- to prepare for the blossoming carbon credit industry.