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Is Carl Icahn Losing His Midas Touch?

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Is Carl Icahn Losing His Midas Touch?
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Astute investors who have mastered the art and science of investing are an elite group to whom an average investor looks up to for portfolio modeling. Given the fickleness associated with the stock market, it's a tough proposition to continuously make money.

However, names such as Carl Icahn are up there, doing it quarter after quarter, year after year. Icahn takes the No. 8 spot on a recent list of world's top 12 investors compiled by Wallstreetsurvivor.com.

Related Link: Carl Icahn's Track Record In Big Pharma

Modus Operandi

Icahn has a peculiar way of adding value to his investments. Also called corporate raider and activist investor, Icahn barges into the boardroom of companies, which according to him are poorly managed, most often as an unwelcome intruder.

He buys into these companies, forces the board to induct his slate of directors and begins managing the company through them. It would be either reforming the wayward company or if such a process becomes cumbersome he forces the company to sell itself. Usually, the mere disclosure that he has picked up a stake in a company is enough to lift its stock price.

Icahn's Holdings: A Report Card

Does Icahn still maintain his Midas touch? Benzinga looked at the holdings that were divulged through the 13-F filing by the billionaire investor and how these stocks have fared in the year-to-date period.

  • American International Group Inc (NYSE: AIG): Down 2.7 percent (Icahn has a $3 billion stake in the insurer).
  • American Railcar Industries, Inc. (NASDAQ: ARII): Up 1.74 percent.
  • CVR Energy, Inc. (NYSE: CVI): Down 12.2 percent.
  • Cheniere Energy, Inc. (NYSE: LNG): Up 13.3 percent.
  • Freeport-McMoRan Inc (NYSE: FCX): Up 2.10 percent (Icahn trimmed his position by 12.3 percent to 91.2 million class B shares).
  • Herbalife Ltd. (NYSE: HLF): Up 20.40 percent (Icahn raised stake by 14.7 percent to 22.5 million shares).
  • Hertz Global Holdings, Inc (NYSE: HTZ): Down 8.58 percent (Icahn raised stake by 126.2 percent to 29.3 million shares).
  • Icahn Enterprises LP (NASDAQ: IEP): Down 8.37 percent (Icahn added more than 2.9 million shares in his publicly traded hedge fund during the fourth quarter).
  • Manitowoc Company Inc (NYSE: MTW): Up 0.84 percent.
  • Manitowoc Foodservice Inc (NYSE: MFS): Down 6.05 percent.
  • Navistar International Corp (NYSE: NAV): Down 16.3 percent.
  • Nuance Communications Inc. (NASDAQ: NUAN): Up 13.02 percent (reduced the stake).
  • Paypal Holdings Inc (NASDAQ: PYPL): Up 8.03 percent (reduced the stake).
  • Xerox Corp (NYSE: XRX): Up 30.26 percent.

Only recently, the Wall Street Journal reported of Icahn taking a huge position in Bristol-Myers Squibb Co (NYSE: BMY). The stock is down close to 4 percent in the year-to-date period.

Icahn's interest doesn't seem to be reflecting investor interest for his holdings. Stocks of about half the companies in his portfolio are seen languishing in the year-to-date period. Even the ones seen in the green have not made substantial gains.

Incidentally, in the same timeframe, the broader markets have been on a record run. The S&P 500 and the Dow Jones Industrial Average 2 Minute are up about 5 percent each and the NASDAQ Composite has gained close to 8 percent.

That said, the 13-F filing alone can't be used to testify to the astuteness of an investment manager. Details of the filings are released only 45 days after the end of a quarter. Additionally, the filing doesn't give details of short positions or investment in other avenues such as bonds.

Posted-In: Carl Icahn Wall Street JournalEducation Hedge Funds Markets Movers Trading Ideas General Best of Benzinga

 

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