In this article, we discuss 15 best stocks to buy and hold according to billionaire Carl Icahn. If you want to see more stocks in this selection, check out 5 Best Stocks to Buy and Hold According to Billionaire Carl Icahn.
Carl Icahn, recognized for his expertise in the financial market, faced another blow on May 10 as the shares of his holding company experienced a significant decline. This drop in value occurred after Hindenburg Research, a short seller, released a damning report, resulting in a total valuation decrease of over $6 billion since the attack. On May 10 alone, CNBC mentioned that the shares plummeted by 15.1%, following a nearly 25% loss the previous week. On May 9, Hindenburg made allegations against Icahn Enterprises L.P. (NASDAQ:IEP), claiming that the company had inflated the value of its holdings and relied on a structure resembling a “Ponzi scheme” to distribute dividends. CNBC reported that Icahn Enterprises said in its latest 10-Q filing:
“The U.S. Attorney’s office has not made any claims or allegations against us or Mr. Icahn with respect to the foregoing inquiry.”
According to a report by The Street, Hindenburg’s note to investors stated that Icahn’s last winning year was 2013, when the fund outperformed the market and returned 30.8%. From 2014 onwards, Carl Icahn’s investment portfolio has experienced a decline of 53%, says Hindenburg. Meanwhile, during the same timeframe, the S&P index has generated a return of 147%. According to Hindenburg’s assessment, Icahn Enterprises L.P. (NASDAQ:IEP) is described as paying out dividends that are “mathematically unsustainable.” This conclusion is drawn from the fact that despite a negative free cash flow of $4.9 billion from 2014 onwards, the company has distributed $1.5 billion in cash dividends during that same period. Hindenburg further noted:
“The company has supported its dividend and declining asset values by selling $1.7 billion through ATM (at the market) unit sales over the past four years… In short, Icahn has been using money from new investors to pay out dividends to old investors.”
Carl Icahn dismissed the report as biased and defended the accuracy of IEP’s financial statements. Icahn is the majority owner of IEP, retaining approximately 85% of the company, and he has utilized more than 60% of his shares as collateral for personal loans. As a result of the Hindenburg report, Icahn’s wealth has plummeted by $7.5 billion, leading to a final net worth of $10.8 billion for him, according to Forbes.
In this article, we discuss the 15 top stocks to buy and hold according to billionaire Carl Icahn. These include FirstEnergy Corp. (NYSE:FE), Southwest Gas Holdings, Inc. (NYSE:SWX), and Xerox Holdings Corporation (NASDAQ:XRX).
Our Methodology
For this list, we selected top 15 stocks from the Q1 2023 13F portfolio of Carl Icahn’s Icahn Enterprises LP. The stocks are ranked in ascending order of their stake value.
Best Stocks to Buy and Hold According to Billionaire Carl Icahn
15. International Flavors & Fragrances Inc. (NYSE:IFF)
Number of Hedge Fund Holders: 39
Icahn Capital LP’s Stake Value: $59,269,000
International Flavors & Fragrances Inc. (NYSE:IFF) produces and distributes cosmetic active ingredients and natural health substances for a wide range of consumer goods across Europe, Africa, the Middle East, Greater Asia, North America, and Latin America. The company is divided into four segments – Nourish, Scent, Health & Biosciences, and Pharma Solutions. In Q1 2023, Carl Icahn owned 644,510 shares of International Flavors & Fragrances Inc. (NYSE:IFF) worth $59.2 million.
On May 3, International Flavors & Fragrances Inc. (NYSE:IFF) declared a $0.81 per share quarterly dividend, in line with previous. The dividend is distributable on July 11, to shareholders of record on June 23.
According to Insider Monkey’s fourth quarter database, 39 hedge funds were bullish on International Flavors & Fragrances Inc. (NYSE:IFF), compared to 41 funds in the prior quarter.
Like FirstEnergy Corp. (NYSE:FE), Southwest Gas Holdings, Inc. (NYSE:SWX), and Xerox Holdings Corporation (NASDAQ:XRX), International Flavors & Fragrances Inc. (NYSE:IFF) is one of the best stocks to buy and hold according to billionaire Carl Icahn.
Here is what Rhizome Partners has to say about International Flavors & Fragrances Inc. (NYSE:IFF) in its Q1 2021 investor letter:
“We are still getting used to the higher multiples that investors will pay for larger market cap and pure play companies such as IFF. We do understand the market’s rationale. IFF’s products account for a small percentage of the customers’ cost while playing critical roles in the products’ performance. With some operating leverage, the company can probably grow FCF at 4-6% a year. This brings the total return close to the long-term return of the S&P 500 index of 10%. Through trial and error, we have come to appreciate how scale, higher market share, route densities, switching costs, and collaborative relationships amongst major industry players can contribute to sustained high returns on invested capital.”
14. Bausch + Lomb Corporation (NYSE:BLCO)
Number of Hedge Fund Holders: 27
Icahn Capital LP’s Stake Value: $60,935,000
Bausch + Lomb Corporation (NYSE:BLCO) is an eye health company that operates across the world. The company is divided into three segments – Vision Care, Ophthalmic Pharmaceuticals, and Surgical. In the first quarter of 2023, Carl Icahn held 3.50 million shares of Bausch + Lomb Corporation (NYSE:BLCO) worth nearly $61 million.
Following the release of Q1 results, H.C. Wainwright analyst Yi Chen maintained a Buy recommendation on Bausch + Lomb Corporation (NYSE:BLCO) but decreased the price target on the shares to $19 from $21 on May 5. The analyst anticipates continued robust demand in the eye care market, which is expected to drive sales growth for the company. However, Chen acknowledged that expenses necessary to support this growth might remain elevated due to inflationary pressures.
According to Insider Monkey’s fourth quarter database, 27 hedge funds were bullish on Bausch + Lomb Corporation (NYSE:BLCO), compared to 25 funds in the last quarter.
13. SandRidge Energy, Inc. (NYSE:SD)
Number of Hedge Fund Holders: 25
Icahn Capital LP’s Stake Value: $69,439,000
SandRidge Energy, Inc. (NYSE:SD) is involved in the procurement, advancement, and extraction of oil and natural gas primarily in the Mid-Continent region of the United States. Securities filings for Q1 2023 reveal that Carl Icahn’s hedge fund owned 4.8 million shares of SandRidge Energy, Inc. (NYSE:SD) worth $69.4 million. It is one of the best stocks to buy according to the billionaire.
On May 13, SandRidge Energy, Inc. (NYSE:SD) declared a $2.00 per share special dividend, which is payable on June 7 to shareholders of record as of May 24. Furthermore, the company intends to initiate a regular quarterly dividend of $0.10 per share, commencing from the second quarter of 2023, with the first payment scheduled for August 2023. The board of directors also authorized a stock repurchase program worth $75 million, which accounts for approximately 14% of the company’s market capitalization as of May 12.
According to Insider Monkey’s fourth quarter database, 25 hedge funds were bullish on SandRidge Energy, Inc. (NYSE:SD), compared to 26 funds in the prior quarter. Thomas Soviero’s Soviero Asset Management is the biggest stakeholder of the company.
12. Crown Holdings, Inc. (NYSE:CCK)
Number of Hedge Fund Holders: 48
Icahn Capital LP’s Stake Value: $86,027,000
Crown Holdings, Inc. (NYSE:CCK) is a supplier of rigid packaging products, serving customers in Pennsylvania and internationally. The company operates through four segments – Americas Beverage, European Beverage, Asia Pacific, and Transit Packaging. In Q1 2023, Carl Icahn’s Icahn Enterprises held 1 million shares of Crown Holdings, Inc. (NYSE:CCK) worth $86 million, representing 0.39% of the total 13F securities.
On April 27, Crown Holdings, Inc. (NYSE:CCK) declared a quarterly dividend of $0.24 per share, in line with previous. The dividend is payable on May 25, to shareholders of record on May 11.
According to Insider Monkey’s fourth quarter database, 48 hedge funds were long Crown Holdings, Inc. (NYSE:CCK), compared to 42 funds in the earlier quarter. Lauren Taylor Wolfe’s Impactive Capital is the biggest stakeholder of the company, with 3.2 million shares worth $270.2 million.
11. Illumina, Inc. (NASDAQ:ILMN)
Number of Hedge Fund Holders: 44
Icahn Capital LP’s Stake Value: $99,997,000
Illumina, Inc. (NASDAQ:ILMN) focuses on the development, manufacturing, and marketing of tools and integrated systems in the field of life sciences. These tools and systems are designed for the extensive analysis of genetic variation and function. In the first quarter of 2023, Carl Icahn added Illumina, Inc. (NASDAQ:ILMN) to his portfolio by purchasing 430,000 shares worth approximately $100 million.
On April 26, Stifel analyst Daniel Arias increased the price target for Illumina, Inc. (NASDAQ:ILMN) to $265 from $235 and maintained a Buy rating on the company’s shares. Despite the Q1 revenue and EPS surpassing expectations, the analyst noted that the FY23 guidance remained unchanged. However, the analyst views the management’s commitment to improving margins in the future as a positive and unexpected development. The firm believes that the acquisition deal with Grail will eventually be finalized, albeit potentially not as swiftly as desired, which presents an opportunity for compelling upside.
According to Insider Monkey’s fourth quarter database, 44 hedge funds were long Illumina, Inc. (NASDAQ:ILMN), compared to 49 funds in the prior quarter. Select Equity Group is the largest stakeholder of the company.
Ensemble Capital made the following comment about Illumina, Inc. (NASDAQ:ILMN) in its 2022 annual investor letter:
“Illumina, Inc. (NASDAQ:ILMN) (5.17% weight in the Fund): Illumina’s stock price declined 44.87% during the Fund’s fiscal year, detracting 2.01% from relative performance vs the S&P 500. In addition to extraordinary strength in the US dollar detracting from growth in their significant foreign revenue, as well as COVID lockdowns limiting sales in China, the company’s already closed acquisition of the cancer test maker GRAIL was thwarted by European Union After paying approximately $8 billion to acquire GRAIL despite EU regulator’s warning that the deal may violate antitrust rules, Illumina will likely need to divest their ownership of the company taking a loss of nearly $4 billion as estimated by the company.”
10. Conduent Incorporated (NASDAQ:CNDT)
Number of Hedge Fund Holders: 20
Icahn Capital LP’s Stake Value: $130,852,000
Conduent Incorporated (NASDAQ:CNDT) offers business process services, specializing in transaction-intensive processing, analytics, and automation. The company is divided into three segments – Commercial Industries, Government Services, and Transportation. In Q1 2023, Carl Icahn’s hedge fund held 38.14 million shares worth $130.85 million.
On May 16, Conduent Incorporated (NASDAQ:CNDT) announced that its board of directors has authorized a share repurchase program for the company’s common stock, allowing for the buyback of up to $75 million worth of shares over the next three years.
According to Insider Monkey’s fourth quarter database, 20 hedge funds were bullish on Conduent Incorporated (NASDAQ:CNDT), and D E Shaw held the largest stake in the company.
Here is what Miller Value Partners Deep Value Strategy has to say about Conduent Incorporated (NASDAQ:CNDT) in its Q4 2021 investor letter:
“Conduent (CNDT) recently announced their first non-core asset sale at $340M in cash. What is significant about this transaction is the asset sale was at an Enterprise Value-to-Revenue of more than 4x – a significant premium to Conduent’s overall enterprise value. The company monetized less than 3% of company revenue and generated cash equivalent to nearly 30% of its market capitalization, creating significant long-term accretion to the underlying equity value. Recently, The New York Times announced the acquisition of Athletic for $550M. Athletic has 200 sports journalists and generates annual revenue of approximately $65M (acquisition price greater than 8x revenue!).”
9. Cheniere Energy, Inc. (NYSE:LNG)
Number of Hedge Fund Holders: 64
Icahn Capital LP’s Stake Value: $157,600,000
Cheniere Energy, Inc. (NYSE:LNG) is primarily involved in liquefied natural gas businesses within the United States. It is an energy infrastructure company operating in the LNG sector. In the first quarter of 2023, Carl Icahn held 1 million shares of Cheniere Energy, Inc. (NYSE:LNG) worth $157.6 million. It is one of the best stocks to buy according to the billionaire.
On April 3, RBC Capital analyst Elvira Scotto reiterated an Outperform rating on Cheniere Energy, Inc. (NYSE:LNG) but lowered the firm’s price target on the shares to $200 from $205. The analyst highlighted Cheniere Energy, Inc. (NYSE:LNG)’s strong recent financial performance and mentioned the potential for expansions in Corpus Christi and Sabine Pass. RBC Capital continues to have a positive outlook on Cheniere Energy, Inc. (NYSE:LNG), citing its favorable position to benefit from increasing global LNG demand, supported by the company’s brownfield expansion opportunities and strong execution.
According to Insider Monkey’s fourth quarter database, 64 hedge funds were long Cheniere Energy, Inc. (NYSE:LNG), compared to 70 funds in the prior quarter. Michael Lowenstein’s Kensico Capital is a prominent stakeholder of the company, with 787,400 shares worth $118 million.
TimesSquare U.S. Mid Cap Growth Strategy made the following comment about Cheniere Energy, Inc. (NYSE:LNG) in its Q4 2022 investor letter:
“Within Energy, Cheniere Energy, Inc. (NYSE:LNG) is an energy infrastructure company that operates liquefied natural gas (LNG) terminals in Louisiana and Texas. Despite reporting inline for the latest quarter, its stock traded down -9%. Contributing factors were Europe had filled its storage ahead of the winter and a recent dip in natural gas pricing. The market for LNG is likely to remain tight for the next several years. Notably, Cheniere paid down $1.3 billion of long-term debt and repurchased $75 million of common stock during the quarter. Cheniere is well positioned to benefit from ongoing tightness in global gas markets.”
8. Dana Incorporated (NYSE:DAN)
Number of Hedge Fund Holders: 20
Icahn Capital LP’s Stake Value: $215,012,000
Dana Incorporated (NYSE:DAN) offers power-conveyance and energy-management solutions for vehicles and machinery. The company is divided into four segments – Light Vehicle Drive Systems, Commercial Vehicle Drive and Motion Systems, Off-Highway Drive and Motion Systems, and Power Technologies. In Q1 2023, Carl Icahn owned 14.2 million Dana Incorporated (NYSE:DAN) shares, worth $215 million and representing 0.97% of the total 13F portfolio.
On April 28, Dana Incorporated (NYSE:DAN) reported a Q1 non-GAAP EPS of $0.25 and a revenue of $2.64 billion, outperforming Wall Street estimates by $0.17 and $80 million, respectively.
According to Insider Monkey’s fourth quarter database, 20 hedge funds were bullish on Dana Incorporated (NYSE:DAN), compared to 24 funds in the prior quarter. Richard S. Pzena’s Pzena Investment Management is the biggest position holder in the company, with 5.20 million shares worth $78.7 million.
7. Bausch Health Companies Inc. (NYSE:BHC)
Number of Hedge Fund Holders: 41
Icahn Capital LP’s Stake Value: $281,241,000
Bausch Health Companies Inc. (NYSE:BHC) is a pharmaceutical company that specializes in the development, manufacturing, and marketing of a wide range of products, with a focus on gastroenterology, hepatology, neurology, dermatology, international pharmaceuticals, and eye health. Securities filings for the first quarter of 2023 reveal that Carl Icahn owned 34.7 million shares of Bausch Health Companies Inc. (NYSE:BHC) worth 281.2 million. It is one of the best stocks to buy according to the billionaire.
According to Insider Monkey’s fourth quarter database, 41 hedge funds were bullish on Bausch Health Companies Inc. (NYSE:BHC), compared to 44 funds in the prior quarter. John Paulson’s Paulson & Co is the largest stakeholder of the company, with 26.4 million shares worth $166 million.
Here is what Miller Value Partners Opportunity Trust Fund has to say about Bausch Health Companies Inc. (NYSE:BHC) in its Q2 2022 investor letter:
“Bausch Health Companies Inc. (NYSE:BHC) declined during the quarter as the company consummated its Bausch+Lomb IPO at valuations far below expectations, reported disappointing Q1 2022 results, and delayed its plan to spin out its Solta (aesthetics) business due to difficult market conditions. While the company spun off 10% of Bausch+Lomb (BCLO) they retained 90% of the company which they intend to distribute once they have met their target leverage ratio of 6.5-6.7x. The future spin-off value of the Bausch+Lomb piece represents a value of $12.55 per share, 39% above where Bausch Health is currently trading. The company recently appointed John Paulsen as Chair of the Board, which should accelerate value realization.”
6. Newell Brands Inc. (NASDAQ:NWL)
Number of Hedge Fund Holders: 29
Icahn Capital LP’s Stake Value: $373,023,000
Newell Brands Inc. (NASDAQ:NWL) is involved in the design, manufacturing, sourcing, and distribution of consumer and commercial products. The company operates across five segments – Commercial Solutions, Home Appliances, Home Solutions, Learning and Development, and Outdoor and Recreation. In the first quarter of 2023, Carl Icahn held approximately 30 million shares of Newell Brands Inc. (NASDAQ:NWL) worth $373 million, representing 1.69% of the total holdings.
On May 1, Deutsche Bank analyst Steve Powers reiterated a Hold rating on Newell Brands Inc. (NASDAQ:NWL) and lowered the firm’s price target on the shares to $13 from $14 following the Q1 results.
According to Insider Monkey’s fourth quarter database, 29 hedge funds were bullish on Newell Brands Inc. (NASDAQ:NWL), compared to 26 funds in the earlier quarter. Pzena Investment Management is the largest position holder in the company.
Like FirstEnergy Corp. (NYSE:FE), Southwest Gas Holdings, Inc. (NYSE:SWX), and Xerox Holdings Corporation (NASDAQ:XRX), Newell Brands Inc. (NASDAQ:NWL) is one of the best stocks to buy according to billionaire Carl Icahn.
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Disclosure: None. 15 Best Stocks to Buy and Hold According to Billionaire Carl Icahn is originally published on Insider Monkey.
