1. Icahn Enterprises LP (NASDAQ:IEP)
Carl Icahn’s Q2 2024 Stake: $6.70 Billion
Number of Hedge Fund Investors as of Q2 2024: 3
Icahn Enterprises LP (NASDAQ:IEP) is Carl Icahn’s investment firm and biggest holding. It operates as a diversified holding company focused on opportunities in the energy, food, automotive, real estate, and Pharma businesses. The stock accounts for about 61% of Icahn’s Portfolio.
The massive holding concerns that Icahn Enterprises LP (NASDAQ:IEP) pays a dividend of $4 per share while offering a 25% yield. It is one of the highest in the industry and one reason the stock continues attracting income-focused investors.
Nevertheless, Icahn Enterprises has been a big disappointment, losing nearly two-thirds of market value amid negative publicity. It all started with short-seller Hindenburg Research accusing Icahn of running a Ponzi-like scheme with the company.
Hindenburg Research has always doubted Icahn Enterprise’s ability to pay the hefty $4 per share dividends, given the lack of sufficient cash flow to support the distribution. Suggestions that Icahn might be running a Ponzi-like scheme have already attracted the Securities and Exchange Commission, which has taken the billionaire investor to task for using his shares in the company to get loans.
Icahn Enterprises LP (NASDAQ:IEP) is submitting to sell $400 million worth of depository units in a market-based sale, which also appears to have rattled Wall Street. This action might lead to an additional reduction in the value of existing shareholders’ stakes, and the proposed sale is taking place when the shares are still 75% lower than their value before the Hindenburg report was issued the previous year.
As it stands, Icahn Enterprises LP (NASDAQ:IEP) remains under pressure even when trading at a price-to-earnings multiple of 28. The $4 a share dividend with a yield of about 29% is one of the positives that continues offering support to the stock.
By the end of Q2 2024, only three hedge funds held stakes in Icahn Enterprises LP (NASDAQ:IEP), up from one in the preceding quarter. The most significant holder was Carl Icahn’s Icahn Capital LP, with stakes valued at $6.70 billion.
The best stocks to buy, according to Carl Icahn, are companies that the legendary investor expects to generate long-term value. However, given that the artificial intelligence arms race is just but starting, there are under-the-radar AI stocks trading at highly discounted valuations that hold greater promise for anyone looking to diversify their portfolio. If you are looking for an AI stock that is more promising than IEP, check out our report about the cheapest AI stock.
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