Bill Miller Buys Valeant, Sees It Doubling, Likes Financials

  • Fund manager, who comments on CNBC, says he doesn’t hold cash
  • Investor says safe stocks such as utilities will do poorly

Bill Miller, who is best known for beating the S&P 500 Index for 15 straight years, says he has been buying Valeant Pharmaceuticals International Inc. and financial stocks such as OneMain Holdings Inc.

Miller said on CNBC that he purchased shares of Valeant, the beaten-down drug company, last week partly because of its free cash flow.

“We think the stock doubles in three years,” Miller said Monday.

The fund manager said some of the smaller financials are more attractive, such as mortgage insurers. He added that he’s a “big fan” of passive products because most active managers don’t add value. 

Miller, 66, said he doesn’t hold any cash in his portfolio and that safe stocks such as utilities will continue to do poorly.

Miller’s $1.3 billion Legg Mason Opportunity Trust lost 4.6 percent this year through Oct. 21, trailing 99 percent of peers, according to data compiled by Bloomberg. Over five years he beat 97 percent.

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