5 Undervalued Stocks Picked by Billionaire Gabelli

This article presents an overview of the 5 Undervalued Stocks Picked by Billionaire Gabelli. For a detailed overview of such stocks, read our article, 11 Undervalued Stocks Picked by Billionaire Gabelli.

5. CNH Industrial NV (NYSE:CNHI)

Number of Hedge Fund Investors: 29

GAMCO’s Stake: $106M

With a PE ratio of 6.65 and a dividend yield of 3.46%, CNH Industrial NV (NYSE:CNHI) ranks fifth in our list of the top undervalued stocks picked by billionaire Mario Gabelli.

GAMCO owns a stake worth about $106 million in CNH Industrial NV (NYSE:CNHI).

Oakmark Global Select Fund made the following comment about CNH Industrial N.V. (NYSE:CNHI) in its Q3 2023 investor letter:

“CNH Industrial N.V. (NYSE:CNHI) (Italy), which designs, manufactures, and distributes agricultural and construction equipment, was the top detractor for the quarter. CNH Industrial’s share price fell following its second-quarter results, as agriculture equipment sales rose 5% in local currency, a slowdown from the prior quarter. This performance fell below market expectations due to destocking activity in Brazil and some production ramp-up issues for its new Patriot sprayer. We believe the production issues are temporary while the destocking actions will better position the business for the midterm. Pricing power remains quite strong and increased by roughly 7%, and precision agricultural sales grew by 21%. While the market was overly focused on near-term demand and sales growth, the agriculture equipment division produced its highest quarterly margin ever at 16.8%—an encouraging development that supports our view of the company’s long-term profitability. Further, the much smaller construction business delivered strong results, including its own quarterly margin record. Management maintained guidance for the rest of the company’s current fiscal year and indicated it expects to exceed the 2024 targets laid out at a capital markets day in 2022. We recently met with CEO Scott Wine at the company’s offices. He expressed confidence in the company’s ability to drive much better through-cycle financial performance while avoiding the company’s previous mistakes. He also believes the company’s share price is materially undervalued, and although he would prefer to invest in the business, he sees an opportunity to increase returns to shareholders via share repurchases. We believe CNH Industrial remains a solid business in an attractive industry that is run by a much-improved management team.”