We recently compiled a list of Carl Icahn’s stock portfolio: 7 Best Stocks to Buy. In this article, we’ll take a look at how Bausch Health Companies Inc. (NYSE:BHC) stands compared to other stocks in the Carl Icahn stock portfolio.
Carl Icahn is an influential figure who has made a name for himself and made billions by questioning the decisions and strategies of Wall Street corporate leaders for decades. . Nicknamed the “Lone Wolf of Wall Street,” he will go down in history as the most feared man on Wall Street for his fame and accomplishments.
At 88 years old, the billionaire investor would be expected to see his momentum slow. But that’s not the case. Mr. Icahn continues to shock with his trends and sentiments about the economy and the stock market.
Also read: The 10 best-performing Warren Buffett stocks in 2024, according to short sellers, and the 15 worst 52-week low stocks to buy now.
Nevertheless, recent bad press has put pressure on this legendary investor. He remains embroiled in allegations that he took out large personal loans through his company’s shares while issuing unsustainably high dividends through his investment company. In 2023, short-seller Hindenburg Research questioned the dividends on offer and Mr. Icahn’s meddling, calling the practice a pyramid-like scheme.
The legendary investor has not admitted wrongdoing, but has already agreed to pay $2 million to settle a lawsuit filed by the U.S. Securities and Exchange Commission accusing him of failing to disclose large amounts borrowed against his company’s stock. I agree. Mr. Icahn’s investment firm lost more than 70% of its market value, everything collapsed, and the company remains under scrutiny from Wall Street investors.
Wall Street investors could lose confidence in the billionaire investor, said Gordon Haskett of Gordon Haskett Research Advisors. First, there are concerns that further losses at Mr. Icahn’s investment company could force investors to sell their current holdings.
Mr. Icahn made a name for himself by diversifying his Wall Street investments across a variety of sectors. His diversification has invested in some of the market leaders in real estate, energy, finance and technology.
The billionaire investor has an impressive track record of average annual returns of 14% from 2000 to 2022, outperforming the S&P 500’s returns by 6%. The solid returns are attributable to this billionaire investor leveraging an aggressive investment strategy to acquire stakes in his companies. It is believed to be trading below fair value.
the story continues
Mr. Icahn has always used his influence to drive strategic change as part of an activist campaign to unlock hidden values. He is best known for engaging in proxy fights, making public demands, and staging hostile takeovers whenever he believes there is an opportunity to unlock hidden value.
Given that Mr. Icahn is known for his high-risk, high-reward strategies, his portfolio is made up of stocks with hidden value that can be unlocked by doing the hard things. Mr. Icahn’s holdings are more opportunistic and less focused on specific sectors, but are spread across technology, health care and energy sectors.
Carl Icahn built a fortune worth billions of dollars by investing in undervalued companies and advocating profitable change. Considering his impressive resume, it’s understandable that Wall Street and Main Street investors are always curious about the best stocks to buy.
His portfolio is well-positioned to benefit from the US Federal Reserve cutting interest rates by 50 basis points to support the struggling economy. The impact of lower interest rates on stocks will depend largely on the underlying fundamentals: corporate earnings performance and the direction of the U.S. economy, whether heading into a mild or deep recession. Wells Fargo analysts believe the global economy will also see benefits, given that the world’s major central banks have already cut interest rates or are planning to do so soon.
If the economy hits a soft landing, lower interest rates and stronger economic fundamentals will combine to favor certain market segments, such as real estate and small businesses, where Mr. Icahn is heavily invested.
Additionally, Wall Street expects lower interest rates to encourage increased spending and investment in established, financially sound companies, which will be reflected in stock prices in the second half of 2024 and early 2025.
our methodology
Carl Icahn scanned the legendary investor’s 13F portfolio at the end of Q2 2024 to create a list of the best stocks to buy. We analyzed Mr. Icahn’s top 7 stocks based on his holdings and highlighted what makes them stand out as solid investment strategies. . Finally, we ranked the stocks in ascending order based on Icahn Capital’s stock value.
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Bausch Health Companies Inc. (NYSE:BHC)
Carl Icahn’s stock in Q2 2024: $242.01 million
Number of hedge fund investors as of Q2 2024: 32
Bausch Health Companies Inc. (NYSE:BHC) is a diversified specialty pharmaceutical and medical device company that manufactures and markets a wide range of gastroenterology, hepatology, neurology, dermatology, and international pharmaceutical products.
It is one of Carl Icahn’s most notable assets. The company has been forced to refute claims that it is considering filing for bankruptcy, and its financial health has been called into question. Similarly, there are reports that the company is considering selling its eye care division and is using the services of Goldman Sachs.
The sale will provide Bausch Health Companies (NYSE:BHC) with the necessary capital to survive. In August 2020, BHC revealed plans to spin off Bausch & Lomb’s eye care division, including its Worldwide Vision Care, Surgical and Pharmaceutical divisions, into Bausch & Lomb, a publicly traded company independent from the rest of the company.
Another concern is the imminent loss of exclusivity for Bausch Health Companies’ (NYSE:BHC) flagship drug Xifaxan, which could have a significant impact on the company’s revenue base.
Amid rumors of bankruptcy, the company reported mixed second-quarter results, with sales up 11% for the year to $2.4 billion. Consolidated operating income decreased to $389 million from $412 million in the same period last year. Similarly, net income attributable to shareholders decreased from $26 million as of the second quarter of 2023 to $10 million.
Insider Monkey analyzed the stock holdings of 912 hedge funds in Q2 2024 and found that 32 hedge funds had an investment in Bausch Health Companies (NYSE:BHC). Carl Icahn’s Icahn Capital LP is the hedge fund’s largest shareholder, with $242.01 million in stock.
Overall, BHC ranks 6th on the list of best stocks to buy, according to Carl Icahn. While we recognize BHC’s potential as an investment, we believe AI stocks have a better chance of delivering higher returns over shorter time periods. If you’re looking for more promising AI stocks than BHC, check out our report on the cheapest AI stocks.
Read next: $30 trillion opportunity: 15 humanoid robot stocks to buy, according to Morgan Stanley and Jim Cramer, says NVIDIA has ‘become a wasteland.’
Disclosure: None. This article was originally published on Insider Monkey.
