5 Long-Term Stocks to Buy According to Billionaire Mario Gabelli

3. Bank of New York Mellon Corporation (NYSE:BK)

Number of Hedge Fund Holders: 38  

Bank of New York Mellon Corporation (NYSE:BK) provides a range of financial products and services. Regulatory filings show that GAMCO Investors owned 2.1 million shares of Bank of New York Mellon Corporation (NYSE:BK) at the end of June 2022 worth $87 million, representing a small portion of the portfolio. 

On August 12, Deutsche Bank analyst Brian Bedell maintained a Hold rating on Bank of New York Mellon Corporation (NYSE:BK) stock and raised the price target to $46 from $42, noting that alternative asset managers were better positioned for upside.

At the end of the second quarter of 2022, 38 hedge funds in the database of Insider Monkey held stakes worth $3.6 billion in Bank of New York Mellon Corporation (NYSE:BK), compared to 54 in the preceding quarter worth $4.6 billion. 

In its Q4 2021 investor letter, Ariel Investments, an asset management firm, highlighted a few stocks and Bank of New York Mellon Corporation (NYSE:BK) was one of them. Here is what the fund said:

“Rising interest rates, after a surprisingly long period of low absolute rates and negative “real” rates, will create a headwind. While there has been much debate about the cause of these low rates, we believe the most important factor has been the $120 billion in monthly federal reserve open market bond purchases and the accumulation of an $8 trillion balance sheet. The former will end, and the latter will shrink. It is not just the Fed that has aggressively purchased bonds, bidding up prices and lowering yields. Bond traders and hedge fund managers have added to positions, confident that being on the same side as the Fed was the wise place to be. Now as the Fed is about to become a seller of bonds rather than a buyer, Wall Street’s “smart money” is likely to follow suit. Against this backdrop, fixed income securities and bond substitutes such as high dividend paying utilities and absolute return hedge funds are substantially overpriced and are not likely to produce attractive returns going forward (…read more)