Corporate raider Carl Icahn no longer manages money for external clients. However, he still manages more than $21 billion of 13F assets for his family office, Icahn Capital. It operates under a high-concentration and heavy-conviction investment strategy, owning only 16 positions.
The fund has a long-term mindset and holds each stock in its portfolio for an average of 18.5 quarters, or just over 4.5 years. In addition, Icahn has a top 10 holdings concentration of 96.04%.
During the first quarter, Icahn purchased just one new stock: International Flavors and Fragrances (NYSE:IFF). IFF stock has declined about 12% year-to-date (YTD), but it has outperformed the S&P 500’s YTD loss of 14%.
Furthermore, Icahn completely sold out of Occidental Petroleum (NYSE:OXY). He first purchased shares of OXY stock during Q2 of 2019. Occidental was also the S&P 500’s best performer during Q1.
With that in mind, let’s take a look Icahn’s top five positions.
5 Stocks Carl Icahn Is Betting On
Icahn’s largest position by far is Icahn Enterprises (NASDAQ:IEP). Icahn purchased an additional 9.58 million shares of IEP during Q1. As the name suggests, IEP is Icahn’s multibillion dollar conglomerate business and makes up 62.5% of Icahn’s portfolio.
The business is diversified into several ventures, such as energy, real estate, food packaging and home fashion. IEP stock also pays out a hefty dividend of 15.6%. The dividend helps explain why the company has a five-year return of just 6%.
Icahn’s second- and third-largest positions are CVR Energy (NYSE:CVI) and Cheniere Energy (NYSEAMERICAN:LNG), respectively. CVI carries a 8.06% portfolio allocation, while LNG carries a 5.98% allocation.
It should be noted that Icahn Enterprises is the parent company of CVR Energy. In 2012, Icahn spent $2.6 billion to acquire 80% of it. Since then, CVI stock has returned just over 50% and currently provides a dividend yield of 3.3%. During Q1, the fund did not adjust its CVI position. However, it sold off 39%, or 6.44 million shares, of LNG stock.
The family office’s fourth-largest position is another energy corporation called FirstEnergy (NYSE:FE). FE makes up 3.86% of Icahn’s portfolio. During the quarter, the fund made no changes to its position.
Finally, Bausch Health (NYSE:BHC) is the fund’s fifth-largest position with a 3.52% allocation. Icahn first purchased BHC stock during Q4 of 2020 and made no changes during Q1. Bausch Health has declined by more than 35% since Icahn made his initial purchase in 2020.
During periods of inflation, many investors flock to commodities such as energy. This is because their prices usually increases in stride with inflation. It seems Icahn is doing just that. Out of his top five positions, three companies are focused on energy. Meanwhile, Icahn Enterprises owns energy subsidiaries as well.
On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
