Leon Cooperman On What Makes A Company A Good Investment

Leon Cooperman, Chairman and CEO of Omega Advisors, reveals why free cash flow is the answer to a good investment.

Q1 hedge fund letters, conference, scoops etc, Also read Lear Capital: Financial Products You Should Avoid?

Leon Cooperman Reveals What Makes A Company A Good Investment

Canyon Profits On Covid Crisis Refinancings

stimulus dealCanyon Partners' Canyon Balanced Funds returned -0.91% in October, net of fees and expenses, bringing the year-to-date return to -13.01%. However, according to a copy of the firm's investor correspondence, which ValueWalk has been able to review, the fund quickly bounced back in November, adding 7.3% for the month. Net of fees, the letter reported, Read More


Leon Cooperman reveals what makes a company a good investment from CNBC.

Transcript

I don’t like to bother the new high list. I’m not a momentum investor and value investor. I’d say the one thing that I look at most frequently is free cash flow because the free cash flows will give the companies the luxury to do good thing is pay dividends buy back stock and look at return investment. I look at the balance sheet very important I understand you know a company can earn a return on equity of 15 percent but they could do with no debt. Or they could do what a lot of debt. So I look at return on capital in the winter. People don’t buy it or had they you know so they tend to be on sale. So I’m looking for that mispriced asset. And you know you learn over the years it there’s no stock that is up without an explanation or down without an explanation. My job to figure out where the explanation holds water.