- Billionaire hedge fund manager Leon Cooperman said he likes energy stocks.
- Cooperman said Sen. Bernie Sanders is a bigger threat to the market than the coronavirus.
- He suggested the market is pricing in a 2020 Trump election victory.
Billionaire investor and founder of Omega Advisors Leon Cooperman was a guest on CNBC’s “Halftime Report” on Tuesday to discuss investment opportunities and share his thoughts on U.S. Democratic contends.
‘Not Quite Euphoria’
Cooperman said the markets are in the “early stages of knocking on the door of euphoria” but as a whole it is not “not quite [fully in] euphoria.” However, some parts of the market are very much in a state of “euphoria,” like Tesla.
Cooperman said he is trying to “find things that make sense” in the market and one of those areas is an ancillary-play on Tesla: energy stocks. His hedge fund has an approximate 15% exposure to energy-based stocks as the market “has gone overboard” in their negative position on energy.
He believes investors “can’t own enough Tesla” but as the economy expands, so does the demand for energy from all providers.
According to CNBC, the Energy Select Sector SPDR ETF has lost close to 20% over the past year. Part of the energy’s poor performance is attributed to falling crude and oil prices. By comparison, Tesla’s stock is up more than 275% over the past six months alone.
Ahead of Wednesday’s U.S. Democratic debate, Cooperman said he believes Sen. Bernie Sanders is a “bigger threat” to the stock market than the coronavirus which has killed 2,000 people so far.
Cooperman justified his stance by arguing the world’s greatest minds are focused on treating the coronavirus and in three or four months it will “become resolved.” But American voters could end up electing Sanders for four years and have a “communist” as the leader of the free world for at least four years.
“He is not a socialist,” Cooperman said. “He is — rather — a communist. I just hope the country isn’t ready to elect a communist or a socialist. If we do, I think the market is in store for a big problem.”
Cooperman said the market is pricing in current President Donald Trump will win the 2020 election. If he doesn’t win, the only Democratic candidate who can defeat the sitting president is fellow billionaire Michael Bloomberg. In either scenario, both “would be acceptable to the market.”
Finally, Cooperman said he is supporting Bloomberg but he may face an uphill battle in the nomination process. The former mayor of New York City represents “everything the Democratic party stands for now.” But he will ultimately emerge victorious after a brokered convention in which he has a “good shot” of winning the nomination