10 New Stock Picks of Billionaire Mario Gabelli

In this article, we discuss 10 new stock picks of billionaire Mario Gabelli.

It has become increasingly difficult for investors to identify winners in a market that is dogged by inflation, rising commodity prices, and fears of a recession. Even veteran value investors like Mario Gabelli of GAMCO Investors are finding life difficult at the moment. Gabelli, who owns famous growth names like Amazon.com, Inc. (NASDAQ:AMZN), Microsoft Corporation (NASDAQ:MSFT), and Meta Platforms, Inc. (NASDAQ:FB), manages an equity portfolio worth more than $9 billion as of the end of the second quarter of 2022. 

Filings from the end of June 2022 show that the portfolio of GAMCO Investors decreased by around $2 billion, compared to the first three months of 2022. Between March and June, the fund made new purchases in 39 stocks during the period, additional purchases in 206, sold out of 55, and reduced holdings in 427 stocks. The top ten holdings of the fund, in contrast to other elite hedge funds, comprise just a little over 14.5% of the entire portfolio. The bulk of the portfolio comprises stocks in the services and consumer goods sectors. 

On September 9, Gabelli appeared on news platform CNBC to outline his take on the current market situation, saying that he was bullish on sectors like agriculture and aerospace because there were indications that they would benefit from increased government spending in the coming months. Gabelli added that he was also paying attention to the weapons industry in the wake of the Ukraine war, and food and defense were some of the spaces that made a lot of sense in a world weighed down by fears of war and food shortages. 

Our Methodology

The companies listed below were picked from the investment portfolio of GAMCO Investors at the end of the second quarter of 2022. The stocks that are a new addition to the portfolio, compared to filings for the first quarter of 2022, were selected. Data from around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to identify the number of hedge funds that hold stakes in each firm.

New Stock Picks of Billionaire Mario Gabelli 

10. Whirlpool Corporation (NYSE:WHR)

Number of Hedge Fund Holders: 24 

Whirlpool Corporation (NYSE:WHR) manufactures and markets home appliances and related products. According to the latest filings, GAMCO Investors owned over 2,000 shares of Whirlpool Corporation at the end of the second quarter of 2022 worth $310,000, representing a very small portion of the portfolio. 

On July 15, JPMorgan analyst Michael Rehaut maintained an Overweight rating on Whirlpool Corporation stock and lowered the price target to $191 from $227, noting that key investor concerns around the firm were likely to remain unresolved in the near term. 

Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Greenhaven Associates is a leading shareholder in Whirlpool Corporation, with 2.8 million shares worth more than $438.8 million. 

Just like Amazon.com, Inc., Microsoft Corporation, and Meta Platforms, Inc., Whirlpool Corporation is one of the stocks that elite investors are buying. 

9. VICI Properties Inc. (NYSE:VICI)

Number of Hedge Fund Holders: 25   

VICI Properties Inc. (NYSE:VICI) is an experiential real estate investment trust that owns market-leading gaming, hospitality, and entertainment destinations. Latest data shows that GAMCO Investors owned more than 39,100 shares of VICI Properties Inc. at the end of the second quarter of 2022 worth over $1.1 million, representing a minor portion of the portfolio. 

On August 24, JMP Securities analyst Mitch Germain initiated coverage of VICI Properties Inc. stock with an Outperform rating and a price target of $38, noting that the business strategy of the firm had been stress tested during the pandemic. 

Among the hedge funds being tracked by Insider Monkey, Naples, Florida-based investment firm Pentwater Capital Management is a leading shareholder in VICI Properties Inc., with 4.5 million shares worth more than $135 million.

In its Q2 2022 investor letter, Meridian Funds, an asset management firm, highlighted a few stocks and VICI Properties Inc. was one of them. Here is what the fund said:

“VICI Properties Inc. (NYSE:VICI) is a real estate investment trust company specializing in casinos and other entertainment properties. We invested in VICI in 2018 when earnings were declining due to dilutive acquisitions. Our thesis was that, as investors grew more comfortable with casinos as a REIT subsector, the value of their properties would increase. We also liked the defensive characteristics of the company, specifically the triple-net lease structure, which dictates that lessees pay all maintenance and capital expenditures, and the history of casino REITs with zero rent payments missed by casinos during either the global financial crisis or the 2020 pandemic. Furthermore, we were confident that VICI’s growth prospects would increase as more casinos monetized land holdings with VICI’s ability to use its extensive cash and liquidity to make acquisitions. VICI’s stock outperformed in the quarter due to its appeal as a fairly defensive investment and the news that it would be included in the S&P 500 Index. We maintained our position in VICI.”

8. Royal Gold, Inc. (NASDAQ:RGLD)

Number of Hedge Fund Holders: 25     

Royal Gold, Inc. (NASDAQ:RGLD) acquires and manages precious metal streams, royalties, and related interests. Regulatory filings show that GAMCO Investors owned 8,480 shares of Royal Gold, Inc. at the end of June 2022 worth $2.1 million, representing a small portion of the portfolio. 

On August 5, investment advisory Raymond James maintained an Outperform rating on Royal Gold, Inc. stock and lowered the price target to C$142 from C$144. Analyst Brian MacArthur issued the ratings update. 

Among the hedge funds being tracked by Insider Monkey, New York-based investment firm First Eagle Investment Management is a leading shareholder in Royal Gold, Inc. (NASDAQ:RGLD, with 3.2 million shares worth more than $344 million.

7. DICK’S Sporting Goods, Inc. (NYSE:DKS)

Number of Hedge Fund Holders: 28    

DICK’S Sporting Goods, Inc. (NYSE:DKS) operates as a sporting goods retailer primarily in the eastern United States. Securities filings show that GAMCO Investors owned 6,800 shares of DICK’S Sporting Goods, Inc. at the end of June 2022 worth $513,000, representing a small portion of the portfolio. 

On August 24, Evercore ISI analyst Warren Cheng maintained an Outperform rating on DICK’S Sporting Goods, Inc. stock and raised the price target to $160 from $120, noting that the normalized EPS for the firm would likely settle out somewhere north of $11-$12. 

At the end of the second quarter of 2022, 28 hedge funds in the database of Insider Monkey held stakes worth $1 billion in DICK’S Sporting Goods, Inc., compared to 31 in the previous quarter worth $1.1 billion.

In its Q1 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and DICK’S Sporting Goods, Inc. was one of them. Here is what the fund said:

“DICK’S Sporting Goods, Inc. was the first stock Michael recommended to us shortly after he joined Baron Capital in 2003. Dick’s share price has since increased about nine-fold. Unfortunately, we sold our investment in Dick’s about six years ago and, although it was a successful investment, we did not realize the full benefit of Michael’s recommendation. We sold too soon because I was concerned that competition from internet retailers would have a permanent negative impact on Dick’s stores’ profitability. I was wrong. Dick’s stock price so far has about doubled after we sold…and its prospects have brightened! (…read more)

6. Vertiv Holdings Co (NYSE:VRT)

Number of Hedge Fund Holders: 34 

Vertiv Holdings Co (NYSE:VRT) designs, manufactures, and services critical digital infrastructure technologies. The hedge fund of Mario Gabelli entered the second quarter of 2022 with 14,000 shares of Vertiv Holdings Co in its portfolio worth more than $115,000.

On August 4, Citi analyst Andrew Kaplowitz maintained a Buy rating on Vertiv Holdings Co stock and increased the price target to $15 from $14, noting that the demand for the products of the firm remained strong in the second quarter. 

Among the hedge funds being tracked by Insider Monkey, New York-based firm Eminence Capital is a leading shareholder in Vertiv Holdings Co, with 11 million shares worth more than $91 million. 

In addition to Amazon.com, Inc., Microsoft Corporation, and Meta Platforms, Inc., Vertiv Holdings Co is one of the stocks on the radar of hedge funds. 

In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Vertiv Holdings Co was one of them. Here is what the fund said:

“Vertiv Holdings Co, a leading provider of critical infrastructure for data centers, fell in the quarter. The market became concerned that capital spending for data centers might be slowing along with the economy, which could be the case. If you recall, shares of Vertiv were very weak when the company reported first quarter costs were not properly passed through to their customers, so margins would fall well short of projections.

We believe that Vertiv is now ahead of the curve on this and will demonstrate robust earnings power in the back half of 2022 and into next year. We think it’s a very cheap stock, with strong management and board oversight, and remain hopeful that when the company reverts to form, the shares can appreciate significantly.”

5. Energy Transfer LP (NYSE:ET)

Number of Hedge Fund Holders: 36     

Energy Transfer LP (NYSE:ET) provides energy-related services. The hedge fund of Mario Gabelli entered the second quarter of 2022 with 22,800 shares of Energy Transfer LP in its portfolio worth more than $228,000, representing a minor portion of the total securities.

On August 16, Barclays analyst Theresa Chen maintained an Overweight rating on Energy Transfer LP stock and increased the price target to $14 from $13, noting that there were unique tailwinds within their North American midstream and refining coverage. 

At the end of the second quarter of 2022, 36 hedge funds in the database of Insider Monkey held stakes worth $598 million in Energy Transfer LP, compared to 31 in the previous quarter worth $699 million.

In its Q4 2021 investor letter, Miller Value Partners, an asset management firm, highlighted a few stocks and Energy Transfer LP was one of them. Here is what the fund said:

“Energy Transfer LP rose over the period along with the price of oil climbing 40.59% over the period. The company received positive news that the Dakota Access Pipeline project would not be shut down while the Environmental Impact Statement by the US Army Core of Engineers is drawn up. Energy Transfer reported strong 1Q results with revenue of $17B surpassing expectations for $11.8B with adjusted earnings before income, taxes, depreciation and amortization (EBITDA) hitting $5.04B ahead of consensus of $2.77B. The company raised full year adjusted EBITDA guidance to $12.9-13.3B from $10.6-11.0B previously, with the increase largely related to the benefits realized from Winter Storm Uri. The company paid down $3.7B in debt during the quarter, using strong cash f low to reduce leverage. The company also announced the issuance of $900M in 6.5% Series H perpetual preferreds with the company using the proceeds to repay debt and for general purposes.”

4. Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN)

Number of Hedge Fund Holders: 58     

Biohaven Pharmaceutical Holding Company Ltd. (NYSE:BHVN) develops products for neurological and neuropsychiatric diseases, as well as rare disorders. Securities filings show that GAMCO Investors owned 20,212 shares of Biohaven Pharmaceutical Holding Company Ltd. at the end of June 2022 worth $2.9 million, representing a small portion of the portfolio. 

On August 18, Piper Sandler analyst Christopher Raymond downgraded Pharmaceutical Holding Company Ltd. stock to Neutral from Overweight with a price target of $149, noting valuation as one of the primary reasons behind the ratings update. 

At the end of the second quarter of 2022, 58 hedge funds in the database of Insider Monkey held stakes worth $2.5 billion in Biohaven Pharmaceutical Holding Company Ltd., compared to 41 in the preceding quarter worth $1.3 billion.

3. Zendesk, Inc. (NYSE:ZEN)

Number of Hedge Fund Holders: 63  

Zendesk, Inc. (NYSE:ZEN) develops and provides SaaS solutions for organizations. Regulatory filings show that GAMCO Investors owned 8,988 shares of Zendesk, Inc. at the end of June 2022 worth $666,000, representing a small portion of the portfolio. 

On July 28, William Blair analyst Arjun Bhatia downgraded Zendesk, Inc. stock to Market Perform from Outperform without a price target, noting that the slowdown in the business of the firm was greater than expected.

Among the hedge funds being tracked by Insider Monkey, California-based investment firm Light Street Capital is a leading shareholder in Zendesk, Inc., with 7.3 million shares worth more than $540 million.

In its Q4 2021 investor letter, Carillon Towers Advisers, an asset management firm, highlighted a few stocks and Zendesk, Inc. was one of them. Here is what the fund said:

“Zendesk, Inc. provides customer support software solutions. After successfully navigating the early stages of the pandemic in 2020, the firm has seen its stock cool off on the threat of increased competition from low-cost alternatives. We do not believe that the competitive dynamics have been altered. In fact, the company’s annual revenue growth rate has accelerated in 2021 from the second half of 2020. The shares also currently trade at a deep discount to other cloud-based software vendors.”

2. Occidental Petroleum Corporation (NYSE:OXY)

Number of Hedge Fund Holders: 66    

Occidental Petroleum Corporation (NYSE:OXY), together with its subsidiaries, engages in the acquisition, exploration, and development of oil and gas properties. Latest data shows that GAMCO Investors owned more than 93,800 shares of Occidental Petroleum Corporation at the end of the second quarter of 2022 worth over $5.5 million, representing a minor portion of the portfolio. 

On July 26, investment advisory Barclays maintained an Overweight rating on Occidental Petroleum Corporation stock and lowered the price target to $79 from $84. Analyst Jeanine Wai issued the ratings update. 

At the end of the second quarter of 2022, 66 hedge funds in the database of Insider Monkey held stakes worth $13.8 billion in Occidental Petroleum Corporation, compared to 67 in the previous quarter worth $12.6 billion.

In its Q2 2022 investor letter, Smead Capital Management, an asset management firm, highlighted a few stocks and Occidental Petroleum Corporation was one of them. Here is what the fund said:

“For the quarter, our best-performing stocks were Continental Resources (CLR), Merck (MRK) and Occidental Petroleum Corporation. Despite a steep sell-off in June in the oil and gas stocks, two of our oil stocks made the quarterly list.

If you are wondering how we are outperforming the S&P 500 Index in the first half of the year, look no further than our top three performers. Occidental Petroleum (OXY), Continental Resources (CLR) and Conoco Phillips (COP) soared in value and were barely represented in the S&P 500 Index. To quote Jerry Jones, owner of the Dallas Cowboys, “We are in the first quarter on higher energy prices!””

1. Twitter, Inc. (NYSE:TWTR)

Number of Hedge Fund Holders: 69  

Twitter, Inc. (NYSE:TWTR) operates as a platform for public self-expression and conversation in real-time. According to the latest filings, GAMCO Investors owned over 9,200 shares of Twitter, Inc. at the end of the second quarter of 2022 worth $344,000, representing a very small portion of the portfolio. 

On August 24, Rosenblatt analyst Barton Crockett downgraded Twitter, Inc. stock to Neutral from Buy and lowered the price target to $37 from $52, noting the firm needed a fast resolution to the whistleblower saga.  

At the end of the second quarter of 2022, 69 hedge funds in the database of Insider Monkey held stakes worth $2.4 billion in Twitter, Inc., compared to 68 in the preceding quarter worth $2 billion. 

In its Q2 2022 investor letter, RGIGA Investment Advisors, an asset management firm, highlighted a few stocks and Twitter, Inc. was one of them. Here is what the fund said:

“Early in the second quarter, we sold our Twitter shares on the official announcement that Elon Musk would acquire the company at $54.20 per share. Although we typically would wait for what was then a large 7% merger/arb spread to close, we figured in this market environment it would be beneficial to move aside in the event future drama might ensue while building cash in order to opportunistically deploy into better opportunities. During the quarter, we saw the chance to do so and bought shares in four companies.”

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This article is originally published at Insider Monkey.