2 Stocks You Should Invest In From Icahn’s Wins: Herbalife Ltd. (HLF), Chesapeake Energy Corporation (CHK)

The amount of this special dividend is estimated to be ~$480 million, and will be distributed on Feb. 19, 2013. The company will start distributing the quarterly dividend of ~$0.75/share by the end of 2Q13. The dividend is synchronous with the 100% cash distribution policy of CVRRefiningLP, in which the company holds majority share. The Master Limited Partnership (MLP) was recently formed via the spin-off of CVR’s refining and crude-oil gathering assets. The MLP is expected to generate ~$700 million cash annually, and ~40% of its production for FY13 is hedged, which brings transparency to the future cash flows. Since MLP avails the benefit of non-payment of corporate income tax, the company can distribute higher dividends to its stakeholders. CVR itself made good profits in 2012 as it was benefited by the difference in prices of the cheap oil purchased and the high priced fuel sold. CVR is showing-off a robust balance sheet and confidence in the future generation of cash flows by announcing these dividends. With such assets in its bag and favorable fuel prices CVR’s stock seems strong.

Conclusion

Summing up, content deals and investment in original content can help Netflix increase the requisite number of subscribers, and the company can repeat the strong performance of 4Q12. On the other hand, the Energy sector seems strong, and CVR’s dividend policy and Refining LP’s cash distribution policy proves this. But the changed leadership, aggressive debt restructuring, and selling-off of assets may or may not help Chesapeake Energy. I think until any further detail is obtained from the management Chesapeake should be a hold.

The article 2 Stocks You Should Invest In From Icahn’s Wins originally appeared on Fool.com and is written by Madhu Dube.

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