Short Oil, Long Refiners
Zach Schreiber of PointState Capital, a hedge fund that Stanley Druckenmiller has invested significantly in, said he believes oil prices are poised to fall significantly. Schreiber, who worked for Druckenmiller at Duquesne Management, recommended a short trade in U.S. crude oil and a long-trade in U.S. refiners.
Schreiber said U.S. drillers, chasing the higher prices of crude, may create an oversupply that will impact price. Meanwhile, as drillers shift away from natural gas, prices may eventually rise as supply shrinks.
"The cure for high prices is high prices and the cure for low prices is low prices," Schreiber said. He believes the U.S. will reduce over 1 million barrels of crude a year in coming years, causing prices to drop to $80-to-$85 a barrel.
Three Value Picks From Daruma Capital
Gordon valued Electronics For Imaging at between $60-to-$75 a share, while she valued HB Fuller at between $75-to $90 a share.
Gundlach Bearish on Homebuilders
Legendary bond investor Jeffrey Gundlach of DoubeLine said he believes the U.S. will never-again see a year with over 1.5 million home starts and recommended a short trade in the S&P Homebuilders ETF (XHB).
"New home sales are remarkably weak," Gundlach said, while presenting his belief that younger household have been scarred from the Great Recession and won't prioritize home ownership. Meanwhile, baby boomers short on retirement funds may sell their homes as a means to catch up. Both augur poorly for home construction, Gundlach said.
Chris Shumway of Shumway Capital said he believes Moody's Corporation (MCO) shares are undervalued and noted that the company benefits from significant barriers to entry in the bond rating business. Shumway also said he wasn't concerned about the prospect of regulatory probes after the Department of Justice charged Standard & Poor's in 2012.
Michael Novogratz of Fortress Investment Group said he believes the Brazilian economy will continue to face pressure as the 2014 FIFA World Cup looms. A deteriorating business environment in the BRIC nation could voters to oust President Dilma Roussef, Novogratz said.
Larry Robbins on Glenview Management re-iterated his large investment in healthcare stocks amid a change to the U.S. healthcare system through the Affordable Care Act.
-- Written by Antoine Gara in New York.