5 Long Ideas from the 2015 Sohn London Conference

Although newspapers have been in secular decline for over a decade, Robert Harteveldt of Trishield Capital Management likes newspaper publisher New Media Investment Group Inc (NYSE:NEWM), given the company’s roll-up strategy of acquiring small and medium-sized local newspapers. Harteveldt thinks local papers are sustainable given that they have content that people can’t get elsewhere. New Media Investment Group Inc (NYSE:NEWM) has around 125 daily publications and 490 websites and trades at an attractive valuation, with a dividend yield of 7.3% and free cash flow yield of 17.9%. Unlike other publishers, New Media’s revenue and free cash flow has been increasing over the last few years (partly because the company makes accretive acquisitions).

Not to be left out, Elif Aktug of Pictet Asset Management likes Mead Johnson Nutrition CO (NYSE:MJN), a leader in baby milk formula. Given global demographic trends, baby-related products have a lot of growth ahead of them. Mead Johnson Nutrition CO (NYSE:MJN)’s management has been shareholder friendly, with the company recently implementing a cost cutting initiative and announcing a buyback that could reduce its float by as much as 10%. Because of consolidation in the industry, Aktug also believes the company is a potential take-over target.

Last but certainly not least, Bo Börtemark of Carve Capital likes Yahoo! Inc. (NASDAQ:YHOO), whose core internet operations are valued at near-zero by the market. Börtemark thinks investors have basically given up on the company after many years of disappointing results. A sale of Yahoo! Inc. (NASDAQ:YHOO)’s core web operations could net the company a billion dollars in cash or more, which would likely add to Yahoo’s stock price. A successful turnaround that monetizes Yahoo’s audience would do even more for the stock. Of the 730 elite funds that we track, 89 of them owned Yahoo shares at the end of the third quarter, down from the 104 funds long the stock at the end of June.

Disclosure: None