John Paulson Buys Almost 10 Percent of Caesar's, Buffett's Viacom


John Paulson 's hedge fund, Paulson & Co., best known for record-breaking profits in the financial crisis, stood out last year for its poor performance. His Paulson Advantage fund ended 2011 down 35%, and his Paulson Advantage Plus fund was down 53%, a year in which hedge funds were down 5% on average.

Seeking to reverse the losses, Paulson bought 13 new stocks in the first quarter. The largest new buys were: Caesars Entertainment ( CZR ), Novellus Systems ( NVLS ), Covidien Plc ( COV ), Abovenet Inc. ( ABVT ) and Thomas & Betts ( TNB ).

Caesar's Entertainment, a gaming and casino company, became 1.2% of Paulson's portfolio in the first quarter. He bought 12,37,835 shares at an average price of X. Paulson gave his long case for Caesar's at the Ira Sohn conference on Wednesday, saying he estimates the stock could go up to $138.

"Because the company had been bought out by private equity, and has recently returned to markets, it is a highly leveraged structure where debt has been restructured in such a way that there are no payments until 2015," Paulson said, according to Forbes.

Paulson also bought 2 million shares of Novellus Systems, which manufactures, markets and services advanced deposition and surface preparation equipment for advanced integrated circuits, as well as 1.8 million shares of Covidien, which is engaged in the development, manufacture and sale of healthcare products for use in clinical and home settings.

Abovenet Inc. is a fixed line telecommunications company of which he bought 1 million shares. Thomas & Betts, a manufacturer of connectors and components for worldwide electrical and electronics markets, was his fifth-largest holding, of which he bought 1 million shares.

He also bought 1 million shares of Viacom ( VIAB ), one of Warren Buffett 's new holdings.

See John Paulson 's updated portfolio here .About GuruFocus: tracks the stocks picks and portfolio holdings of the world's best investors. This value investing site offers stock screeners and valuation tools. And publishes daily articles tracking the latest moves of the world's best investors. GuruFocus also provides promising stock ideas in 3 monthly newsletters sent to Premium Members .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing

Referenced Stocks: ABVT , COV , CZR , NVLS , VIAB



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