5 Best Stocks to Buy and Hold According to Billionaire Carl Icahn

In this article, we discuss 5 best stocks to buy and hold according to billionaire Carl Icahn. If you want to see more stocks in this selection, check out 15 Best Stocks to Buy and Hold According to Billionaire Carl Icahn. 

5. Xerox Holdings Corporation (NASDAQ:XRX)

Number of Hedge Fund Holders: 24

Icahn Capital LP’s Stake Value: $527,378,000

Xerox Holdings Corporation (NASDAQ:XRX) specializes in workplace technology, focusing on designing, developing, and selling document management systems and solutions. In Q1 2023, billionaire Carl Icahn reported owning 34.2 million shares of Xerox Holdings Corporation (NASDAQ:XRX), worth $527.3 million and representing 2.39% of the total 13F securities. 

On January 30, Loop Capital analyst Ananda Baruah increased the price target for Xerox Holdings Corporation (NASDAQ:XRX) to $17 from $15 and maintained a Hold rating on the company’s shares following its Q4 earnings surpassing expectations. 

According to Insider Monkey’s fourth quarter database, 24 hedge funds were bullish on Xerox Holdings Corporation (NASDAQ:XRX), compared to 26 funds in the prior quarter. 

4. Southwest Gas Holdings, Inc. (NYSE:SWX)

Number of Hedge Fund Holders: 22

Icahn Capital LP’s Stake Value: $657,011,000

Southwest Gas Holdings, Inc. (NYSE:SWX) is involved in the distribution and transportation of natural gas, operating through three segments – Natural Gas Distribution, Utility Infrastructure Services, and Pipeline and Storage. Carl Icahn held 10.4 million shares of Southwest Gas Holdings, Inc. (NYSE:SWX) in Q1 2023, worth $657 million and representing 2.98% of the total portfolio. Icahn raised his position in the stock by 60% in the March quarter. 

On May 4, Southwest Gas Holdings, Inc. (NYSE:SWX) declared a $0.62 per share quarterly dividend, in line with previous. The dividend is payable on September 1, to shareholders of record on August 15. 

According to Insider Monkey’s fourth quarter database, 22 hedge funds were bullish on Southwest Gas Holdings, Inc. (NYSE:SWX), and Mario Gabelli’s GAMCO Investors held the largest stake in the company. 

3. FirstEnergy Corp. (NYSE:FE)

Number of Hedge Fund Holders: 36

Icahn Capital LP’s Stake Value: $759,848,000

FirstEnergy Corp. (NYSE:FE) is engaged in the generation, transmission, and distribution of electricity across the United States. The company owns and operates various power generation facilities, including coal-fired, nuclear, hydroelectric, wind, and solar power plants. On March 22, FirstEnergy Corp. (NYSE:FE) declared a quarterly dividend of $0.39 per share, in line with previous. The dividend is payable on June 1, to shareholders of record as of May 5. 

Securities filings for the first quarter of 2023 reveal that Carl Icahn owned approximately 19 million shares of FirstEnergy Corp. (NYSE:FE), worth $760 million and representing 3.44% of the total 13F securities. 

According to Insider Monkey’s fourth quarter database, 36 hedge funds were long FirstEnergy Corp. (NYSE:FE), compared to 41 funds in the earlier quarter. First Pacific Advisors held the biggest stake in the company, comprising 3.6 million shares worth $151.5 million. 

Here is what ClearBridge Investments Global Infrastructure Income Strategy has to say about FirstEnergy Corp. (NYSE:FE) in its Q4 2021 investor letter:

“On a regional level, the Strategy’s largest exposure is in the U.S. and Canada (44%), consisting of regulated and contracted utilities (31%) and economically sensitive user-pays infrastructure (13%). During the quarter we initiated new positions in U.S. electric utility FirstEnergy.  With supply chain issues, higher housing costs, higher commodity prices and producer price inflation remaining square in the sights for 2022, we think higher inflation is a risk for global markets. We expect growth to slow to trend or below by mid-2022 and U.S.”

2. CVR Energy, Inc. (NYSE:CVI)

Number of Hedge Fund Holders: 20

Icahn Capital LP’s Stake Value: $2,333,894,000

CVR Energy, Inc. (NYSE:CVI) is involved in petroleum refining and nitrogen fertilizer manufacturing within the United States. In Q1 2023, Carl Icahn’s Icahn Enterprises owned 71.19 million shares worth $2.3 billion, representing 10.59% of the total 13F securities. It is one of the best stocks to buy and hold according to billionaire Carl Icahn. 

On May 1, CVR Energy, Inc. (NYSE:CVI) reported a Q1 non-GAAP EPS of $1.44 and a revenue of $2.29 billion, outperforming Wall Street estimates by $0.40 and $120 million, respectively. The company also declared a $0.50 per share quarterly dividend, in line with previous. The dividend is payable on May 22, to shareholders of record on May 15. 

According to Insider Monkey’s fourth quarter database, 20 hedge funds were bullish on CVR Energy, Inc. (NYSE:CVI), compared to 21 funds in the prior quarter. John Overdeck and David Siegel’s Two Sigma Advisors is the largest stakeholder of the company. 

1. Icahn Enterprises L.P. (NASDAQ:IEP)

Number of Hedge Fund Holders: 3

Icahn Capital LP’s Stake Value: $15,512,877,000

Icahn Enterprises L.P. (NASDAQ:IEP), via its subsidiary companies, engages in different businesses including investment, energy, automotive, food packaging, real estate, home fashion, and pharmaceuticals. In Q1 2023, Carl Icahn’s hedge fund owned nearly 300 million shares of Icahn Enterprises L.P. (NASDAQ:IEP), worth $15.5 billion and representing 70.42% of the total 13F securities. 

On May 18, Icahn Enterprises L.P. (NASDAQ:IEP) declared a $2.00 per share quarterly dividend, in line with previous. The dividend is payable on June 30, to shareholders of record on May 22. 

According to Insider Monkey’s fourth quarter database, 3 hedge funds were bullish on Icahn Enterprises L.P. (NASDAQ:IEP), compared to 2 funds in the prior quarter.

Here is what CrossingBridge Advisors has to say about Icahn Enterprises L.P. (NASDAQ:IEP) in its Q3 2022 investor letter:

“Icahn Enterprises LP, headed by investor Carl Icahn, is a diversified holding company with interests in investments, energy, automotive, food packaging, real estate, home fashion and pharmaceuticals. The investment segment derives revenues from gains and losses from investment transactions. Other operating segments, in most cases, are independently operated businesses obtained through a controlling interest.

As of 2Q22, Icahn Enterprises had Indicative Net Asset Value of $6.6 billion, consolidated debt of $7.1 billion and total liquidity, comprised of cash, investment funds and revolving credit availability, of $7.2 billion. Moreover, as of the end of 3Q22, it had an equity market capitalization of $16.0 billion. Thus, we have no concern regarding credit quality. We have traded in and out of the IEP 4.75% senior unsecured bond, due September 2024, since it was issued in February 2020.

In 3Q22, amidst the downdraft in the high yield market, we were able to purchase these bonds at a yield to maturity over 8.20%, very attractive for a 2-year note with such strong credit quality. Purchased at a discount, the bond would have an even higher annualized total return were the company to redeem it prior to September 15, 2023, when it becomes a current obligation. We expect to continue adding to this position opportunistically.”

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