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10 Best Stocks to Buy According to Billionaire Carl Icahn

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·9 min read
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In this article, we will look at 10 best stocks to buy according to billionaire Carl Icahn. If you want to skip reading about Carl Icahn's investment career, you can go directly to 5 Best Stocks to Buy According to Billionaire Carl Icahn.

Carl Icahn is an American billionaire investor and hedge fund manager of Icahn Capital, a New-York based investment management firm that manages equity and fixed income portfolios. He was among the pioneering activist shareholders and made it a popular investing strategy in the hedge fund industry. As of this May, Mr. Icahn's real-time net worth estimated by Forbes sits around $15.9 billion, placing him at number 43 on the Forbes 400 2021 list and 106 on the Billionaires 2022 list.

Carl Icahn began his career in finance in 1961 at Dreyfus Corporation, where he was a stockbroker. Two years later, he took up his role as an options manager for Tessel, Patrick & Co., shortly after which he moved to Gruntal & Co. where he led the options department until 1968. In 1968, Mr. Icahn gathered a sum of roughly $0.5 million and founded Icahn & Co., which grew to become Icahn Capital. As of the first quarter of 2022, the legendary billionaire investor manages over $21.86 billion in 13F securities through Icahn Capital.

Carl Icahn's Investment Philosophy

Carl Icahn is a contrarian investor and he has a unique investment approach, which has helped him make enormous profits and gain prominence in the hedge fund industry. Mr. Icahn earned the title "corporate raider" in the 1980s after he successfully acquired Trans World Airlines and divested its assets, pocketing a profit of roughly $469 million. Mr. Icahn is known for launching hostile takeovers and engaging in a buying frenzy to overpower the management of companies on his radar. Mr. Icahn builds his strategies on top of extensive market research and identifies companies that are undervalued. Carl Icahn has reportedly said:

“We're not about liquidating companies, but if you do that, why is that terrible? We're not blowing up the factories. The person who buys it should be able to make the asset more productive.”

Carl Icahn's 13F Portfolio

As of the first quarter of 2022, Icahn Capital has a top ten holdings concentration of 97.13%, with the majority of its investments across the industrial goods and utilities segments. Among Icahn Capital's most notable holdings we see Bausch Health Companies (NYSE:BHC), Cheniere Energy, Inc. (NYSE:LNG), and FirstEnergy Corp. (NYSE:FE).

10 Best Stocks to Buy According to Billionaire Carl Icahn
10 Best Stocks to Buy According to Billionaire Carl Icahn

Our Methodology

To determine the 10 best stocks to buy according to billionaire Carl Icahn, we did an assessment of Icahn Capital's Q1 2022 investment portfolio. We picked the top ten 13F holdings of the hedge fund and ranked them in increasing order of stake. Along with each stock, we included the hedge fund sentiment and analyst rating for it. The hedge fund sentiment was derived from Insider Monkey's database, which as of Q1 2022 tracks more than 900 elite hedge funds.

Let's look at the 10 best stocks to buy according to billionaire Carl Icahn.

10 Best Stocks to Buy According to Billionaire Carl Icahn

10. Dana Incorporated (NYSE:DAN)

Icahn Capital’s Stake Value: $251,014,000

Percentage of Icahn Capital’s 13F Portfolio: 1.14%

Number of Hedge Fund Holders: 20

Dana Incorporated (NYSE:DAN) is a leading American supplier of power-conveyance and energy-management solutions for electrified vehicles and machinery in North America, Europe, South America, and the Asia Pacific. This April, Dana Incorporated (NYSE:DAN) posted results for the fiscal first quarter of 2022. The company registered an EPS of $0.16, outperforming expectations by $0.03. The company reported revenues of $2.48 billion, up 9.59% year over year, beating Wall Street estimates by $236.09 million. 

As of March 31, Icahn Capital owns over 14.28 million shares of Dana Incorporated (NYSE:DAN) which brings its stakes in the company to $251.01 million. It is one of the best stocks to buy according to billionaire Carl Icahn. 

This April, Deutsche Bank analyst Emmanuel Rosner trimmed his price target on Dana Incorporated (NYSE:DAN) to $18 from $21 but reiterated a Buy rating on the shares following the company’s earnings release.

At the close of the first quarter of 2022, 20 hedge funds held stakes in Dana Incorporated (NYSE:DAN) worth $441.03 million. This is compared to 16 hedge funds in the previous quarter with stakes of $536.75 million.

9. Welbilt, Inc. (NYSE:WBT)

Icahn Capital’s Stake Value: $264,821,000

Percentage of Icahn Capital’s 13F Portfolio: 1.21%

Number of Hedge Fund Holders: 31

Welbilt, Inc. (NYSE:WBT) designs, develops, and supplies foodservice equipment for the commercial foodservice market worldwide. It is one of the best stocks to buy according to billionaire Carl Icahn. As of March 31, Icahn Capital’s stakes in Welbilt, Inc. (NYSE:WBT) are valued at $264.82 million, which represents 1.21% of Carl Icahn’s 13F portfolio.

On May 10, Welbilt, Inc. (NYSE:WBT) posted results for the fiscal first quarter of 2022. The company registered an EPS of $0.10 and missed expectations by $0.10. Welbilt, Inc. (NYSE:WBT) reported revenues of $333 million, up 5.11% year over year from $316.80 million, missing expectations by $13.80 million.

According to Insider Monkey’s database, at the end of the first quarter of 2022, 31 hedge funds were long Welbilt, Inc. (NYSE:WBT) with stakes worth $1.09 billion. This is compared to 35 positions in the previous quarter with stakes of $1.07 billion.

Like Bausch Health Companies (NYSE:BHC), Cheniere Energy, Inc. (NYSE:LNG), and FirstEnergy Corp. (NYSE:FE), billionaire investor Carl Icahn is also bullish on Welbilt, Inc. (NYSE:WBT).

8. Xerox Holdings Corporation (NYSE:XRX)

Icahn Capital’s Stake Value: $647,757,000

Percentage of Icahn Capital’s 13F Portfolio: 2.96%

Number of Hedge Fund Holders: 25

Xerox Holdings Corporation (NYSE:XRX) is a workplace technology company that designs, develops, and sells document management systems and solutions in the United States, Europe, Canada, and internationally. On April 21, Xerox Holdings Corporation (NYSE:XRX) announced earnings for the fiscal first quarter of 2022. The company reported a loss per share of $0.12 and missed estimates by $0.25. Xerox Holdings Corporation (NYSE:XRX) generated revenues of $1.67 billion, down 2.46% year over year, but outperformed market consensus by $34.67 million.

This April, Citi analyst Jim Suva lowered his price target on Xerox Holdings Corporation (NYSE:XRX) to $15 from $17 and reiterated a Sell rating on the shares.

As of March 31, Icahn Capital owns 32.11 million shares of Xerox Holdings Corporation (NYSE:XRX), which brings its stake in the company to $647.75 million. The investment covers 2.96% of Carl Icahn’s 13F portfolio. It is one of the best stocks to buy according to billionaire Carl Icahn.

Insider Monkey found 25 hedge funds bullish on Xerox Holdings Corporation (NYSE:XRX) at the end of Q1 2022. The collective stakes of these hedge funds were valued at $817.49 million. This is compared to 23 positions in the prior quarter with stakes worth $969.88 million.

7. Herc Holdings Inc. (NYSE:HRI)

Icahn Capital’s Stake Value: $672,177,000

Percentage of Icahn Capital’s 13F Portfolio: 3.07%

Number of Hedge Fund Holders: 25

Herc Holdings Inc. (NYSE:HRI) is a leading global equipment rental supplier. On April 21, Herc Holdings Inc. (NYSE:HRI) announced earnings for the fiscal first quarter of 2022. The company generated revenues of $567.30 million, up 25.01% year over year, beating estimates by $14.53 million. Herc Holdings Inc. (NYSE:HRI) reported earnings per share of $1.95 but missed estimates by $0.01.

This April, Baird analyst Mircea Dobre slashed his price target on Herc Holdings Inc. (NYSE:HRI) to $158 from $161 and reiterated a Neutral rating on the shares.

As of March 31, Icahn Capital’s stakes in Herc Holdings Inc. (NYSE:HRI) are valued at $672.17 million. The investment covers 3.07% of Carl Icahn’s 13F portfolio. The stock is among the top ten holdings of Icahn Capital.

This May, Herc Holdings Inc. (NYSE:HRI) declared a quarterly cash dividend of $0.575 per share. The dividend is payable on June 10 to shareholders of record on May 27. As of May 31, Herc Holdings Inc. (NYSE:HRI) has a trailing-twelve-month dividend yield of 1.36%.

At the end of Q1 2022, 25 hedge funds were bullish on Herc Holdings Inc. (NYSE:HRI). The total stakes of these hedge funds were valued at $1.41 billion. This is compared to 27 hedge funds in the previous quarter with stakes worth $1.36 billion.

6. Newell Brands Inc. (NYSE:NWL)

Icahn Capital’s Stake Value: $708,038,000

Percentage of Icahn Capital’s 13F Portfolio: 3.23%

Number of Hedge Fund Holders: 31

Newell Brands Inc. (NYSE:NWL) is a leading American supplier of consumer and commercial products worldwide. This April, Newell Brands Inc. (NYSE:NWL) released earnings for the fiscal first quarter of 2022. The company reported earnings per share of $0.36, beating estimates by $0.09. Moreover, the company generated revenues of $2.39 billion, up 4.37% year over year, and beat market consensus by $109.54 million.

This May, Newell Brands Inc. (NASDAQ:NWL) announced that its board of directors have declared a quarterly cash dividend of $0.23 per share. The common stock cash dividend is payable on June 15 to investors of record at the close of business on May 31. As of May 31, the stock has a forward dividend yield of 4.20%.

As of Q1 2022, Icahn Capital’s stakes in Newell Brands Inc. (NYSE:NWL) are worth $708.03 million, which covers 3.23% of Carl Icahn’s 13F portfolio. It is the sixth-best stock to buy according to billionaire Carl Icahn.

On March 30, JPMorgan analyst Andrea Teixeira slashed her price target on Newell Brands Inc. (NASDAQ:NWL) to $26 from $29 and maintained an Overweight on the shares.

At the close of Q1 2022, 31 hedge funds held stakes in Newell Brands Inc. (NYSE:NWL) worth $1.64 billion. This is compared to 26 positions in the previous quarter with stakes of $1.74 billion.

Among the top 13F holdings of Icahn Capital, we have Newell Brands Inc. (NYSE:NWL) Bausch Health Companies (NYSE:BHC), Cheniere Energy, Inc. (NYSE:LNG), and FirstEnergy Corp. (NYSE:FE).

 

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Disclosure: None. 10 Best Stocks to Buy According to Billionaire Carl Icahn is originally published on Insider Monkey.