Carl Icahn is highly bullish on one natural gas company. Yesterday, the billionaire activist investor announced that he is doubling down on his Southwest Gas (NYSE:SWX) holdings. According to a Securities and Exchange Commission (SEC) filing, Icahn currently holds 10,520,600 shares of SWX stock, having made multiple purchases in March 2023 alone. The natural gas producer has been highly volatile this month, rising and falling very sharply at several points.
Although SWX stock is rising today and has had an overall good week, it is still recovering from a difficult year, during which it shed more than 20% of its value. However, Icahn clearly believes that it will rise again in the coming months.
Let’s take a closer look at this company and what investors should be expecting in the coming year.
Icahn’s Big Bet on SWX Stock
As of this writing, SWX stock is up almost 2% for the day, though it has lost some of its earlier momentum. News of Icahn’s recent purchase likely isn’t influencing it too much. The fact that other companies in the natural gas space, such as Cheniere Energy (NYSEMKT:LNG) and Antero Resources (NYSE:AR) are also rising suggests that SWX’s gains can be attributed to positive market momentum.
That said, Icahn’s bet on SWX stock does deserve some consideration. It suggests that the billionaire believes that energy plays in the natural gas sector make sense again. Icahn has been bullish on it the since last year. In June 2022, he purchased 2.19 million SWX shares, taking his holdings to over $5 million. Now he’s doubling down on the stock even more. Per Seeking Alpha:
“To bump up his position in the Nevada-based utility, Icahn purchased 252,376 shares of SWX at $60.15 per share and 55,154 SWX shares at $61, translating to about $18.6 million, as per a form 4 filing dated March 24.”
The outlet also notes that this comes after Icahn made another large-scale purchase earlier in the month, spending $31 million on more shares. With this week’s buy, he has spent $220 million on SWX stock in just this month. It will be interesting to see if other investors follow suit and make aggressive plays on the natural gas sector.
On the date of publication, Samuel O’Brient 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.
