6 Stocks Purchased by Billionaire Tepper Include Oracle, Apple

BOSTON (TheStreet) -- Billionaire hedge fund manager David Tepper of Appaloosa Management is again dumping the same bank stocks that made him a fortune in 2009 and moving into beaten-down companies Oracle (ORCL) and Boston Scientific (BSX).

Thanks to prescient bets on Bank of America ( BAC) and Citigroup ( C), Tepper's flagship fund more than doubled in 2009 after the market meltdown that was spurred by the collapse in financial stocks.

David Tepper (Appaloosa Management)

After eliminating his hedge fund's positions in bank stocks like Bank of America and Wells Fargo ( WFC) in the third quarter, Tepper dropped his entire stake in Citigroup and E*Trade Financial ( ETFC) during the past quarter. As of Sept. 30, Appaloosa owned 2.5 million shares of Citigroup with a market value of $64.5 million.

Hedge fund and investment managers who oversee more than $100 million are required to disclose their equity holdings, options and convertible debt on a Form 13F filed to the Securities and Exchange Commission within 45 days of the end of a quarter. Funds aren't required to report short positions, which bet on declines. Tepper ended the fourth quarter with 23 reported holdings that carried a market value of $764 million. During the quarter, Tepper sold completely out of 23 positions, including Citigroup and E*Trade.

>> View David Tepper's Portfolio

Tepper took an ax to his energy, materials and industrials holdings, reducing the hedge fund's exposure to all three sectors from three months earlier. Petroleum refiners HollyFrontier ( HFC) and Tesoro ( TSO), potash company Mosaic ( MOS) and Delta Air Lines ( DAL) were among Tepper's liquidations during the fourth quarter.

Appaloosa also reduced positions in other energy, industrials and materials companies. The hedge fund trimmed its holdings in Valero ( VLO), CF Industries ( CF), International Paper ( IP), CVR Energy ( CVI) and Goodyear ( GT).

However, Tepper's Appaloosa hedge fund hasn't completely given up on risk. The famed hedge fund manager initiated four new positions and added to two others in the fourth quarter, which are detailed below and on the following pages.


General Motors ( GM)

Company Profile: General Motors is the world's largest automaker by sales, having emerged from Chapter 11 bankruptcy protection in 2009.

Tepper's Investment: While the fund cut its entire stake in Dana Holding ( DAN), Appaloosa picked up more GM warrants in the fourth quarter, a stake that represents less than 1% of Tepper's disclosed portfolio.

Share Price Performance: Although Tepper's fund doesn't own the actual common shares, GM's stock has performed solidly this year, up 25% already.

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Apple ( AAPL)

Company Profile: Apple is the maker of hot consumer electronic devices like the iPad, iPhone and Mac line of computers.

Tepper's Investment: Appaloosa added to its Apple stake in the fourth quarter, buying up more than 143,000 shares. The position held a market value of $73.6 million as of Dec. 31. Overall, the position represents 9.6% of Tepper's disclosed portfolio, making it his third largest holding.

Share Price Performance: Apple shares have gone parabolic, recently passing the psychologically important $500 share price level. After rallying more than 24% in 2011, Apple shares are up another 25% in 2012.


Delphi Automotive ( DLPH)

Company Profile: Delphi is the world's largest supplier of auto parts. After a Chapter 11 bankruptcy filing, Delphi went public again in November.

Tepper's Investment: Appaloosa initiated a new position in Delphi during the quarter, buying 229,000 shares. The stake carried a market value of $4.9 million as of Dec. 31. Overall, the position represents less than 1% of Tepper's disclosed portfolio.

Share Price Performance: Since the IPO, Delphi shares are up 36%, likely making the pick a winner for Tepper. The stock is up 35% since Dec. 31.

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Financial Select Sector SPDR ( XLF)

Company Profile: The ETF corresponds to the Financial Select Sector Index, which has exposure to banks, insurance companies, REITs, thrifts and other financial companies.

Tepper's Investment: Although he sold out of his big bank positions, it seems as though Tepper can't completely quit financial stocks. Appaloosa bought 2.1 million shares of the ETF in the fourth quarter, a stake that carried a market value of nearly $28 million as of Dec. 31. Overall, the position represents 3.6% of Tepper's disclosed portfolio.

Share Price Performance: The ETF was crushed in 2011 as most bank stocks were hit hard, falling more than 18%. However, the ETF has climbed 12% already in 2012 as several financial stocks have recovered. The ETF is Tepper's seventh largest position among his disclosed holdings as of Dec. 31.


Oracle ( ORCL)

Company Profile: Oracle is the third-largest software company in the world, developing database management tools for clients.

Tepper's Investment: Appaloosa bought 1.2 million shares of Oracle in the fourth quarter, a stake that carried a market value of $31.2 million as of Dec. 31. Overall, the position represents 4% of Tepper's disclosed portfolio, making it his sixth largest position.

Share Price Performance: Oracle shares sank more than 18% last year, but the stock has rallied more than 10% since Dec. 31.

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Boston Scientific ( BSX)

Company Profile: Boston Scientific is a maker of medical devices like stents and other specialty products used in cardiology and oncology.

Tepper's Investment: Appaloosa bought 7.8 million shares of Boston Scientific in the fourth quarter, a stake that carried a market value of $41.6 million as of Dec. 31. Overall, the position represents 5.4% of Tepper's disclosed portfolio, making it his fifth largest position.

Share Price Performance: Boston Scientific, whose shares plunged 30% in 2011, is a true value stock pick for Tepper. The stock has rallied more than 10% since Dec. 31.

>>To see these stocks in action, visit the 6 Stocks Purchased by Billionaire David Tepper portfolio on Stockpickr.

-- Written by Robert Holmes in Boston.

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Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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