In this article, we discuss the 10 stocks that Mario Gabelli is selling. If you want to skip our detailed analysis of Gabelli’s history, investment philosophy, and hedge fund performance, go directly to Mario Gabelli is Selling These 5 Stocks.
Mario Gabelli is an Italian-American investor and hedge fund manager who founded GAMCO Investors in 1976, which is a New York-based hedge fund that offers brokerage services to mutual funds, institutional investors, and high net-worth individuals.
Mario Gabelli is an MBA graduate from Columbia Business School, and takes a keen interest in value investing. Although he is not an activist shareholder, his firm is the largest filer of 13D forms in America, which are used by investors if they want to register as active shareholders who can engage with company boards.
GAMCO Investors’ portfolio is worth $11.3 billion as per the 13F filings from Q3 2021, with investments concentrated in the industrials, information technology, finance, healthcare, consumer staples, consumer discretionary, and communications sectors, with a top ten holdings concentration of 15.03%.
In the third quarter of 2021, GAMCO Investors bought 57 new stocks, made additional purchases in 232 securities, sold out of 51 companies, and reduced holdings in 403 equities. The fund’s top buys for the period were General Motors Company (NYSE:GM), Madison Square Garden Entertainment Corp. (NYSE:MSGE), and Valmont Industries, Inc. (NYSE:VMI). Whereas, GAMCO Investors reduced holdings in Macquarie Infrastructure Holdings, LLC (NYSE:MIC), Edgewell Personal Care Company (NYSE:EPC), and Intel Corporation (NASDAQ:INTC).
The most notable stocks in Mario Gabelli’s Q3 2021 portfolio included American Express Company (NYSE:AXP), The Walt Disney Company (NYSE:DIS), and JPMorgan Chase & Co. (NYSE:JPM).
Our Methodology
We used Mario Gabelli’s Q3 2021 portfolio for this analysis, selecting the stocks that his hedge fund sold out of in the period. We have ranked the securities according to the hedge fund sentiment around each stock.
Mario Gabelli is Selling These Stocks
10. Kimberly-Clark Corporation (NYSE:KMB)
Number of Hedge Fund Holders: 28
Kimberly-Clark Corporation (NYSE:KMB) is a Wisconsin-based multinational manufacturing corporation, dealing in sanitary paper products and medical instruments.
Mario Gabelli, via GAMCO Investors, started building a position in Kimberly-Clark Corporation (NYSE:KMB) back in Q3 2012, and held a stake in the company consistently before discarding the shares entirely in Q4 2018. Over the years, he bought and sold out of the stock repeatedly, and as of Q2 2021, his stake in Kimberly-Clark Corporation (NYSE:KMB) was valued at $200,000, which he disposed of in Q3 2021.
Kimberly-Clark Corporation (NYSE:KMB) declared on January 26 a $1.16 per share quarterly dividend, which is a 1.8% increase from its prior dividend of $1.14. The dividend is payable on April 4, for shareholders of record on March 4.
Publishing its Q4 results on January 26, Kimberly-Clark Corporation (NYSE:KMB) posted earnings per share of $1.30, beating estimates by $0.05. The $4.97 billion revenue also outperformed estimates by $62.87 million.
Barclays analyst Lauren Lieberman lowered the price target on Kimberly-Clark Corporation (NYSE:KMB) on January 28 to $127 from $148 and kept an Equal Weight rating on the shares. Kimberly-Clark Corporation (NYSE:KMB) is facing an inflationary cycle that is “broader and longer than any before,” the analyst told investors in a research note.
Among the hedge funds tracked by Insider Monkey in Q3 2021, 28 funds were bullish on Kimberly-Clark Corporation (NYSE:KMB), down from 37 funds in the prior quarter. Holocene Advisors held the leading stake in Kimberly-Clark Corporation (NYSE:KMB) during the third quarter, with 945,712 shares worth $125.25 million.
9. Cummins Inc. (NYSE:CMI)
Number of Hedge Fund Holders: 30
Cummins Inc. (NYSE:CMI) is an American multinational company that designs and manufactures engines, filtration systems, fuel cell systems, turbochargers, and commercial vehicles for the heavy equipment and automotive industries.
GAMCO Investors first purchased shares of Cummins Inc. (NYSE:CMI) in Q3 2012, and kept its stake in the company consistently before selling off the shares in Q3 2015. In Q4 2020, the hedge fund invested in Cummins Inc. (NYSE:CMI) once again, and by Q2 2021, Mario Gabelli held 13,470 shares of the company, worth $3.28 million, which he discarded entirely in Q3 2021.
Cummins Inc. (NYSE:CMI) published its Q4 results on February 3, posting earnings per share of $2.73, missing estimates by $0.41. Revenue over the period totaled $5.85 billion, surpassing estimates by $43.05 million.
On February 8, Cummins Inc. (NYSE:CMI) declared a $1.45 per share quarterly dividend, in line with previous. The dividend is payable on March 3, to shareholders of record on February 18.
Deutsche Bank analyst Nicole DeBlase on December 10 lowered the price target on Cummins Inc. (NYSE:CMI) to $247 from $251 and kept a Hold rating on the shares. The analyst does not expect supply chain and price/cost headwinds to alleviate in the second half of 2022 for the multi-industry sector.
Among the hedge funds tracked by Insider Monkey in Q3 2021, 30 hedge funds were bullish on Cummins Inc. (NYSE:CMI), down from 45 funds in the preceding quarter. First Eagle Investment Management held a leading stake in Cummins Inc. (NYSE:CMI) as of the close of the third quarter, with 1.94 million shares worth $437.3 million.
Mario Gabelli chose to sell his stake in Cummins Inc. (NYSE:CMI) heading into Q3 2021, unlike American Express Company (NYSE:AXP), The Walt Disney Company (NYSE:DIS), and JPMorgan Chase & Co. (NYSE:JPM), which still feature on his portfolio.
8. Parker-Hannifin Corporation (NYSE:PH)
Number of Hedge Fund Holders: 39
Parker-Hannifin Corporation (NYSE:PH) is an Ohio-based company designing motion and control technologies. Mizuho analyst Brett Linzey on December 16 initiated coverage of Parker-Hannifin Corporation (NYSE:PH) with a Neutral rating and a $345 price target. The analyst sees “plenty to like” about the company’s long-term outlook but not enough near-term upside to warrant a Buy rating.
Mario Gabelli initially purchased shares of Parker-Hannifin Corporation (NYSE:PH) in Q1 2014, before selling the stake off in Q4 2015. Over the years, he was inconsistent with his position in the company. In Q2 2021, he held 11,836 shares of Parker-Hannifin Corporation (NYSE:PH), worth $3.6 million, which he sold off entirely in Q3 2021.
On February 3, Parker-Hannifin Corporation (NYSE:PH) reported earnings for Q4 2021. The company posted an EPS of $4.46, beating estimates by $0.53. Revenue over the period jumped 12.10% year-on-year, totaling $3.82 billion, outperforming estimates by $105.19 million.
Parker-Hannifin Corporation (NYSE:PH) on January 27 declared a $1.03 per share quarterly dividend, in line with previous. The dividend is payable on March 4, for shareholders of record on February 11.
Among the hedge funds tracked by Insider Monkey, 39 hedge funds held long positions in Parker-Hannifin Corporation (NYSE:PH), down from 42 funds in the prior quarter. Viking Global is the leading stakeholder of the company, with more than 3 million shares worth $867 million.
Here is what Oakmark Funds has to say about Parker-Hannifin Corporation (NYSE:PH) in their Q1 2021 investor letter:
“Parker Hannifin approached our estimates of intrinsic value and were, therefore, eliminated during the period. The company was a longstanding investment of the Fund and produced successful outcomes. We believe Parker Hannifin, one of our longest tenured positions, is a high-quality, well-managed industrial with strong competitive positions in good end markets. However, after the market price reflected these positives, we elected to sell to pursue more attractive alternatives that were priced at steeper discounts to our estimates of intrinsic value.”
7. CRISPR Therapeutics AG (NASDAQ:CRSP)
Number of Hedge Fund Holders: 43
CRISPR Therapeutics AG (NASDAQ:CRSP) is a Switzerland-based biotechnology company that focuses on treatments for sickle cell disease and rare blood disorders. Cowen analyst Tyler Van Buren on December 6 initiated coverage of CRISPR Therapeutics AG (NASDAQ:CRSP) with a Market Perform rating.
CRISPR Therapeutics AG (NASDAQ:CRSP) was a new arrival in Mario Gabelli’s Q2 2021 portfolio, with his hedge fund buying 3,100 shares of the company, worth $502,000. Gabelli discarded his CRISPR Therapeutics AG (NASDAQ:CRSP) stake entirely heading into the third quarter of 2021.
According to the third quarter database Insider Monkey, 43 hedge funds were bullish on CRISPR Therapeutics AG (NASDAQ:CRSP), with stakes totaling $1.21 billion, as compared to 34 funds in the quarter earlier, holding stakes in CRISPR Therapeutics AG (NASDAQ:CRSP) worth $1.76 billion. ARK Investment Management held the biggest stake in the company in Q3 2021, with 7.5 million shares worth $849 million.
6. General Electric Company (NYSE:GE)
Number of Hedge Fund Holders: 53
General Electric Company (NYSE:GE) is a New York-based multinational conglomerate that manufactures aircrafts, engines, electrical distribution systems, electric motors, and wind turbines, among other products.
Mario Gabelli discarded his long-time position in General Electric Company (NYSE:GE) in Q3 2021. He started building a stake in General Electric Company (NYSE:GE) back in Q3 2012, and by the second quarter of 2021, he held a $4.1 million position in General Electric Company (NYSE:GE), before selling off his shares in the next quarter.
On January 25, General Electric Company (NYSE:GE) published its Q4 results, posting an EPS of $0.92, exceeding estimates by $0.03. The $20.30 billion revenue dropped 7.41% year-over-year, missing market consensus estimates by $1 billion.
Deutsche Bank analyst Nicole DeBlase on January 27 lowered the price target on General Electric Company (NYSE:GE) to $108 from $119 and kept a Buy rating on the shares. The analyst attributes the post-earnings selloff to weaker than expected segment income results and “noisy” 2022 earnings guidance. The analyst, however, continues to see significant upside based on her sum-of-the-parts analysis.
According to the Q3 database of Insider Monkey, 53 hedge funds were bullish on General Electric Company (NYSE:GE), down from 67 funds in the preceding quarter. Eagle Capital Management was a prominent stakeholder of the company, holding 13.6 million shares worth $1.40 billion.
General Electric Company (NYSE:GE) is on the investment radar of the smart money, just like American Express Company (NYSE:AXP), The Walt Disney Company (NYSE:DIS), and JPMorgan Chase & Co. (NYSE:JPM).
Here is what Vulcan Value Partners has to say about General Electric Company (NYSE:GE) in its Q3 2021 investor letter:
“During the quarter, we sold our positions in General Electric Co. General Electric is a company we followed for a long time. In the past, we removed GE from the MVP list due to management’s poor capital allocation decisions which resulted in value instability. Larry Culp, the former CEO of Danaher, became CEO of General Electric in 2018. The company implemented a vast restructuring program to simplify the industrial side of its business, sold off non-core assets, paid down debt with the proceeds, and drastically shrunk GE Capital. These restructuring activities allowed its world-class jet engine and healthcare businesses to shine through, and improved value stability. As a result, we added the company back to the MVP list. While the pandemic negatively impacted General Electric’s aviation business in the short run, it also gave us the opportunity to buy General Electric in the second quarter of 2020 with a substantial margin of safety. GE is a good example of a competitively entrenched, yet slower growing MVP business. As its stock price rose rapidly over the last year, its value growth did not keep up, and the price to value gap closed quickly. As our margin of safety diminished, we sold our position in GE and allocated it to more discounted companies.”
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Disclosure: None. Mario Gabelli is Selling These 10 Stocks is originally published on Insider Monkey.
