Cardinal trades for 29.50, or about 15 times fiscal 2010 earnings. The stock could rally into the low 40s in the next year as management takes steps to increase profitability.

Einhorn's top holdings include long positions in URS (URS), Teradata (TDC), Wyeth(WYE), Cardinal Health (CAH), Market Vectors Gold Miners ETF(GDX), Allegheny Energy (AYE), EMC (EMC, and Einstein Noah (BAGL).

recent pullback and also has great long term potential while splitting the business next year

quarterly dividend will increase 25% to 17.5 cents a share, effective with the July 15 payout to shareholders of record as of July 1.

Solid performer...

Cardinal Health is one of a handful of restructuring candidates in the fund's portfolio. Growth has slowed in its branded and generic drug-distribution business, but the industry has consolidated, with only two other major players, AmerisourceBergen (ABC) and McKesson (MCK). Cardinal has restructured the drug operations, which are improving. "We think the drug-distribution earnings are stabilizing in the next six months, and will begin to grow again. The other half of the business, medical products, has been growing and will continue" to do so at double-digits. Cardinal Health recently said it would split its drug-distribution and medical-products units. "It's undervalued, and the two parts are worth more than the whole," says DeGulis. Sound Shore has a mid-60s target price on the stock, recently near 44.

You can see MedcoHealth (MHS), Cardinal Health (CAH) and Quest Diagnostics (DGX) rallying, another cohort that's struggling to put in a recession bottom.

Believe in company growth

TP $74.00

17%

Two bear indicators here: 1) look at the 5 year chart -- from 70 down to 40 and back to 70. This is the "treadmill to nowhere". 2) look at the tiny, microscopic dividend. Health care is 14% of the total U.S. economy. Surely a company that is kicking ass and taking names in a prime sector can do better than this.

growth