In this article, we discuss the 10 long-term stocks to buy according to billionaire Mario Gabelli.
The investing acumen of legendary value investors like Mario Gabelli of GAMCO Investors has come under increased media spotlight in recent months as rising rates and soaring inflation wreaks havoc with the stock market. Gabelli, who is known for keeping a low profile, recently appeared on news platform CNBC to outline his thoughts on the macroeconomic environment, saying that it was important that investors take a “microscope” to the fundamentals, like balance sheets, before making important decisions.
Gabelli, who manages a Q2 2022 equity portfolio worth over $9 billion that includes prominent names like Amazon.com, Inc. (NASDAQ:AMZN), Microsoft Corporation (NASDAQ:MSFT), and Meta Platforms, Inc. (NASDAQ:FB), added that he liked “agriculture companies” because there were around $535 billion likely to go into the sector this year, up from around $405 billion in the previous year, and this would enable these stocks to significantly outperform the market within the next twelve months.
The prediction is significant since market analysts are of the view that the United States economy is likely to go into a recession in the coming year as the central bank pushes aggressive interest rate hikes to bring inflation under control. Gabelli, in June, forecast that the key to navigating market volatility and high energy prices in the present environment was in looking at stock specifics, like revenue, cash burn, and other basic indicators. The present moves that Gabelli has made at the market outline his philosophy much better.
Our Methodology
The companies listed below were picked from the investment portfolio of GAMCO Investors as of the end of the second quarter of 2022. The companies that have been in the portfolio for ten or more years were preferred for the list. Data from around 900 elite hedge funds tracked by Insider Monkey in the second quarter of 2022 was used to identify the number of hedge funds that hold stakes in each firm.
Long-Term Stocks to Buy According to Billionaire Mario Gabelli
10. GATX Corporation (NYSE:GATX)
Number of Hedge Fund Holders: 17
GATX Corporation (NYSE:GATX) operates as a railcar leasing company in the United States and internationally. According to the latest filings, GAMCO Investors owned over 1.6 million shares of GATX Corporation (NYSE:GATX) at the end of the second quarter of 2022 worth $150 million, representing 1.65% of the portfolio.
On July 22, Susquehanna analyst Bascome Majors maintained a Positive rating on GATX Corporation (NYSE:GATX) stock and lowered the price target to $112 from $122, noting the firm enjoys considerable pricing power from a tight railcar supply and high new car prices globally.
At the end of the second quarter of 2022, 17 hedge funds in the database of Insider Monkey held stakes worth $193 million in GATX Corporation (NYSE:GATX), compared to 14 in the previous quarter worth $255 million.
Just like Amazon.com, Inc. (NASDAQ:AMZN), Microsoft Corporation (NASDAQ:MSFT), and Meta Platforms, Inc. (NASDAQ:FB), GATX Corporation (NYSE:GATX) is one of the long-term stocks to buy according to billionaire Mario Gabelli.
9. Sony Group Corporation (NYSE:SONY)
Number of Hedge Fund Holders: 26
Sony Group Corporation (NYSE:SONY) develops, produces, and sells electronic equipment, instruments, and devices. The hedge fund of Mario Gabelli entered the third quarter of 2022 with 1.7 million shares of Sony Group Corporation (NYSE:SONY) in the portfolio worth more than $146 million, representing 1.6% of the portfolio.
On September 7, Goldman Sachs analyst Minami Munakata resumed coverage of Sony Group Corporation (NYSE:SONY) stock with a Neutral rating and a price target of 12,200 yen, noting that the near-term earnings of the firm would level off.
Among the hedge funds being tracked by Insider Monkey, New York-based investment firm GAMCO Investors is a leading shareholder in Sony Group Corporation (NYSE:SONY), with 1.8 million shares worth more than $146.5 million.
In its Q1 2022 investor letter, Aristotle Capital Management, an asset management firm, highlighted a few stocks and Sony Group Corporation (NYSE:SONY) was one of them. Here is what the fund said:
“Sony Group Corporation (NYSE:SONY), maker of the PlayStation videogame console, was a leading detractor for the quarter. After a strong year in 2021, a shortfall in PlayStation 5 sales due to continued semiconductor shortages has dampened new console unit sales. Although there are likely to be continued limitations on the supply of components in the short term, consumer demand remains strong, and upcoming releases of major titles such as Horizon Forbidden West and Gran Turismo 7 are likely to further enhance demand. While Sony continues to manage supply-chain headwinds, the company has also again demonstrated its ability to build on the fundamental strength of its business across various segments. During the quarter, Sony acquired Bungie, a U.S.-based videogame developer known for the Destiny franchise and live game services; completed its initial equity investment in Japan Advanced Semiconductor Manufacturing, a foundry service subsidiary of Taiwan Semiconductor Manufacturing Company (TSMC); and acquired Brazilian music label Som Livre. Lastly, Sony announced a partnership with Honda Motor (NYSE:HMC) where the two companies expect to combine Honda’s expertise in manufacturing vehicles with Sony’s proficiency in imaging, sensing, telecommunication and network technologies to develop and commercialize electric vehicles. We feel these strategic actions demonstrate Sony’s ability to continue to improve on its market positions across its business segments with a long-term, forward-looking approach.”
8. Textron Inc. (NYSE:TXT)
Number of Hedge Fund Holders: 23
Textron Inc. (NYSE:TXT) operates in the aircraft, defense, industrial, and finance businesses. Regulatory filings show that GAMCO Investors owned 1.8 million shares of Textron Inc. (NYSE:TXT) at the end of June 2022 worth $113 million, representing 1.24% of the portfolio.
On September 13, Bernstein analyst Douglas Harned initiated coverage of Textron Inc. (NYSE:TXT) stock with a Market Perform rating and a price target of $74, noting the stock appeared biased to the downside.
At the end of the second quarter of 2022, 23 hedge funds in the database of Insider Monkey held stakes worth $787 million in Textron Inc. (NYSE:TXT), compared to 26 in the preceding quarter worth $931 million.
7. Wells Fargo & Company (NYSE:WFC)
Number of Hedge Fund Holders: 83
Wells Fargo & Company (NYSE:WFC) is a diversified financial services firm. Regulatory filings show that GAMCO Investors owned 1.3 million shares of Wells Fargo & Company (NYSE:WFC) at the end of June 2022 worth $54 million, representing 0.59% of the portfolio.
At the end of the second quarter of 2022, 83 hedge funds in the database of Insider Monkey held stakes worth $5.1 billion in Wells Fargo & Company (NYSE:WFC), compared to 93 in the previous quarter worth $6.8 billion.
In its Q4 2021 investor letter, Davis Funds, an asset management firm, highlighted a few stocks and Wells Fargo & Company (NYSE:WFC) was one of them. Here is what the fund said:
“The absolute level of revenues and profits generated by such companies is in fact so large that most of the major financial holdings in the portfolio produce enough annual operating income individually that a number of them could, in theory, purchase several entire businesses among hundreds of choices within the S&P 1500 Index, using just a year’s cash earnings without dipping into capital. This is theoretical, as financial companies would not be in the business of buying healthcare or technology companies, for example, but we point out these facts to illustrate the sheer scale of the economics produced by single financial companies in a given year, which is often a multiple of the cash earnings yielded by companies in a host of other industries.
Given this cash-generation power, we are naturally drawn to what we believe are strong and profitable financial institutions when the price is right. Presently, we believe the valuations of our financial holdings are not only reasonable, but extremely compelling, and our portfolio composition reflects this view. Representative financial holdings in the Fund includes Wells Fargo & Company (NYSE:WFC).”
6. CNH Industrial N.V. (NYSE:CNHI)
Number of Hedge Fund Holders: 25
CNH Industrial N.V. (CNHI) designs, produces, markets, sells, and finances agricultural and construction equipment and vehicles. The hedge fund of Mario Gabelli entered the third quarter of 2022 with 9.8 million shares of CNH Industrial N.V. (CNHI) in the portfolio worth more than $113 million, representing 1.24% of the portfolio.
On August 1, Deutsche Bank analyst Nicole DeBlase maintained a Buy rating on CNH Industrial N.V. (CNHI) stock and raised the price target to $17 from $16, noting the firm had reported a solid quarter and had room for upside.
Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Harris Associates is a leading shareholder in CNH Industrial N.V. (CNHI), with 98 million shares worth more than $1.1 billion.
Along with Amazon.com, Inc. (NASDAQ:AMZN), Microsoft Corporation (NASDAQ:MSFT), and Meta Platforms, Inc. (NASDAQ:FB), CNH Industrial N.V. (CNHI) is one of the long-term stocks to buy according to billionaire Mario Gabelli.
In its Q2 2022 investor letter, Oakmark Funds, an asset management firm, highlighted a few stocks and CNH Industrial N.V. (CNHI) was one of them. Here is what the fund said:
“We sold our position in Iveco Group (Italy), in favor of names that, in our opinion, offer a more favorable risk/return profile. Iveco Group’s arrival in the Fund stemmed from CNH Industrial N.V. (NYSE:CNHI)’s demerger of its trucks and commercial vehicles business in early January. We continue to hold CNH Industrial as we believe it holds an attractive valuation at its current price.”
5. Mueller Industries, Inc. (NYSE:MLI)
Number of Hedge Fund Holders: 19
Mueller Industries, Inc. (NYSE:MLI) manufactures and sells copper, brass, aluminium, and plastic products. Latest data shows that GAMCO Investors owned more than 3 million shares of Mueller Industries, Inc. (NYSE:MLI) at the end of the second quarter of 2022 worth over $162 million, representing 1.77% of the portfolio.
On July 18, Northcoast analyst Ryan Connors initiated coverage of Mueller Industries, Inc. (NYSE:MLI) stock with a Buy rating and a price target of $125, noting that the demand outlook appeared positive for the firm in the coming months.
4. Genuine Parts Company (NYSE:GPC)
Number of Hedge Fund Holders: 32
Genuine Parts Company (NYSE:GPC) supplies automotive replacement parts, industrial parts, and materials. The company is one of the long-term stocks to buy according to billionaire Mario Gabelli. Securities filings show that GAMCO Investors owned 726,255 shares of Genuine Parts Company (NYSE:GPC) at the end of June 2022 worth $96 million, representing a small portion of the portfolio.
On July 28, Wedbush analyst Seth Basham maintained a Neutral rating on Genuine Parts Company (NYSE:GPC) stock and raised the price target to $150 from $140, appreciating the second quarter earnings beat of the firm.
At the end of the second quarter of 2022, 32 hedge funds in the database of Insider Monkey held stakes worth $406 million in Genuine Parts Company (NYSE:GPC), compared to 29 in the preceding quarter worth $457 million.
3. Bank of New York Mellon Corporation (NYSE:BK)
Number of Hedge Fund Holders: 38
Bank of New York Mellon Corporation (NYSE:BK) provides a range of financial products and services. Regulatory filings show that GAMCO Investors owned 2.1 million shares of Bank of New York Mellon Corporation (NYSE:BK) at the end of June 2022 worth $87 million, representing a small portion of the portfolio.
On August 12, Deutsche Bank analyst Brian Bedell maintained a Hold rating on Bank of New York Mellon Corporation (NYSE:BK) stock and raised the price target to $46 from $42, noting that alternative asset managers were better positioned for upside.
At the end of the second quarter of 2022, 38 hedge funds in the database of Insider Monkey held stakes worth $3.6 billion in Bank of New York Mellon Corporation (NYSE:BK), compared to 54 in the preceding quarter worth $4.6 billion.
In its Q4 2021 investor letter, Ariel Investments, an asset management firm, highlighted a few stocks and Bank of New York Mellon Corporation (NYSE:BK) was one of them. Here is what the fund said:
“Rising interest rates, after a surprisingly long period of low absolute rates and negative “real” rates, will create a headwind. While there has been much debate about the cause of these low rates, we believe the most important factor has been the $120 billion in monthly federal reserve open market bond purchases and the accumulation of an $8 trillion balance sheet. The former will end, and the latter will shrink. It is not just the Fed that has aggressively purchased bonds, bidding up prices and lowering yields. Bond traders and hedge fund managers have added to positions, confident that being on the same side as the Fed was the wise place to be. Now as the Fed is about to become a seller of bonds rather than a buyer, Wall Street’s “smart money” is likely to follow suit. Against this backdrop, fixed income securities and bond substitutes such as high dividend paying utilities and absolute return hedge funds are substantially overpriced and are not likely to produce attractive returns going forward (…read more)
2. Deere and Company (NYSE:DE)
Number of Hedge Fund Holders: 54
Deere and Company (NYSE:DE) manufactures and distributes various equipment worldwide. Latest data shows that GAMCO Investors owned more than 221,577 shares of Deere and Company (NYSE:DE) at the end of the second quarter of 2022 worth over $66 million, representing 0.72% of the portfolio.
On August 24, Argus analyst John Eade maintained a Buy rating on Deere and Company (NYSE:DE) stock and raised the price target to $420 from $390, noting that the earnings of the firm appeared to be back in growth mode.
Among the hedge funds being tracked by Insider Monkey, Chicago-based investment firm Citadel Investment Group is a leading shareholder in Deere and Company (NYSE:DE), with 1.5 million shares worth more than $458 million.
In its Q2 2022 investor letter, LRT Capital Management, an asset management firm, highlighted a few stocks and Deere and Company (NYSE:DE) was one of them. Here is what the fund said:
“Deere & Company (NYSE:DE) manufactures machines and equipment, which help the agriculture and construction industries. The company’s production and precision agriculture segment manufacture global equipment and technology solutions for production-scale growers of large grains, small grains, cotton, and sugar. The small agriculture and turf segment develops equipment for dairy and livestock producers, crop producers, and turf and utility customers. Finally, the construction and forestry segment make a range of machines for the earthmoving, forestry, and roadbuilding production systems (…read more)
1. American Express Company (NYSE:AXP)
Number of Hedge Fund Holders: 67
American Express Company (NYSE:AXP) provides charge and credit payment card products, as well as travel-related services. According to the latest filings, GAMCO Investors owned over 856,470 shares of American Express Company (NYSE:AXP) at the end of the second quarter of 2022 worth $118 million, representing 1.3% of the portfolio.
On July 26, Citi analyst Arren Cyganovich maintained a Neutral rating on American Express Company (NYSE:AXP) stock and raised the price target to $159 from $148, noting the firm had posted strong sales trends.
Among the hedge funds being tracked by Insider Monkey, Omaha-based investment firm Berkshire Hathaway is a leading shareholder in American Express Company (NYSE:AXP), with 151.6 million shares worth more than $2.1 billion.
In its Q2 2022 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and American Express Company (NYSE:AXP) was one of them. Here is what the fund said:
“In financials, American Express Company (NYSE:AXP) has done an excellent job demonstrating the resiliency of its franchise in the midst of a global pandemic that drove a 60% decline in its core travel and entertainment business. The company’s spend-centric model has been helped by fiscal stimulus ensuring a flush consumer, while management continues to execute well by adding millions of new consumer and small and medium business accounts, which should benefit the franchise over the medium to long term. We remain optimistic regarding the company’s prospects as travel and entertainment activity rebounds, adding to our position in the quarter.”
You can also take a peek at 10 Russell 2000 Basic Materials Dividend Stocks to Buy and 10 Utilities Stocks with Over 3% Dividend Yield.
Follow Insider Monkey on Twitter
Suggested Articles:
- 10 Financial Services Dividend Stocks with Over 4% Yield
- 15 Best Momentum Stocks To Invest In
- 10 Cheap Hemp Stocks Redditors are Buying
Disclosure. None. 10 Long-Term Stocks to Buy According to Billionaire Mario Gabelli is originally published on Insider Monkey.
