Atlas Pipeline Partners
Keeping Cooperman’s big bet on Atlas Energy in mind, it’s no surprise that the billionaire is also bullish on another MLP affiliated with the company, Atlas Pipeline Partners, L.P. (NYSE:APL). The natural gas processor is the 14th largest holding in Cooperman’s equity portfolio, and shares have had a solid year, up 20.8%.
In comparison to Atlas Energy, Atlas Pipeline’s focus as a full-service midstream company has allowed it to generate about twice the cash as its aforementioned ally, and thus, a higher dividend yield. Atlas Pipeline currently offers a yield of 6.5% on its shares and dividend payments have grown in five consecutive years.
A couple more
We haven’t even discussed KKR and SandRidge yet. The latter is another oil and gas E&P, but unlike some of Cooperman’s other picks in the energy sector, SandRidge does not currently pay a dividend. With earnings growth of more than 40% expected this year alone, however, there’s much more momentum behind any bullish thesis here, and shares are actually pretty cheaply valued at 1.6 times book and a close parity on a price-to-sales basis. Cooperman has held SandRidge stock since the fourth quarter of 2012 and depending on when he bought in, he could have booked as much as a 15% return so far on his investment.
KKR Financial, meanwhile, sits just inside Leon Cooperman’s 15 largest holdings and offers a whopping dividend yield of 8%. Yes, they’re up only 3.5% over the past year, but shares of KKR Financial are extremely attractive because of their depressed valuation; they trade at less than 7 times forward earnings and a price-to-earnings growth ratio of a mere 0.6. With double-digit annual earnings growth expected over the next five years and positive free cash flow,dividends appear sustainable.
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