United Continental Holdings Inc (UAL), Centurylink Inc (CTL), More: 8 Huge Ideas We Saw At The Sohn Conference

The Sohn Investment Conference, one of the biggest hedge fund gatherings of the year, took place yesterday in New York, with Bill Ackman, David Einhorn, Keith Meister, and Larry Robbins among the hedge fund heavyweights that offered their theses on one or more of their most promising ideas. We’ve gathered a list of some of the top presentations and will check out how the market has reacted to them since yesterday.

Bill Ackman, Pershing Square – Howard Hughes Corp (NYSE:HHC)

We’ll start with Ackman, who famously pitched Valeant Pharmaceuticals Intl Inc (NYSE:VRX) at the Sohn Conference in 2015, a disastrous pick that ended up crashing by 95%. Ackman stuck to one of his longtime holdings, Howard Hughes, at this year’s event, saying that it’s “one of the most attractive times in the history of the company to invest.” Ackman likes Howard Hughes Corp (NYSE:HHC)’s geographical diversity and integrated business segments, and believes its South Street Seaport property is “one of the most valuable pieces of real estate I’ve seen in my career.” Howard Hughes Corp (NYSE:HHC) has surged by 5.73% this week.

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We’ll check out several other presentations on the following pages.

David Einhorn, Greenlight Capital – Core Laboratories N.V. (NYSE:CLB)

Einhorn was one of the few money managers to pitch a short idea yesterday during what was otherwise an exceedingly bullish conference. His target was Core Laboratories N.V. (NYSE:CLB), which he believes will fall by 45%. He described the company as having a cyclical business model, in contrast to the wider perception that it’s a secular growth company, and believes management is overestimating the recovery of oil prices (Core Labs believes oil prices are in the middle of a V-shaped pattern). He believes Core Labs got lucky during the 2009 drop in WTI, but won’t be so lucky again, saying that “this time around, it’s exposed to the least desirable parts of the sector.” Core Laboratories N.V. (NYSE:CLB) shares have sank by 6.6% this week.

Keith Meister, Corvex Capital – Centurylink Inc (NYSE:CTL)

Meister is a fan of Centurylink Inc (NYSE:CTL) in the lead up to its acquisition of Level 3 Communications, Inc. (NYSE:LVLT), which will result in it becoming the second-largest telco in North America, citing the huge benefits that mergers have for telecom companies, including greater scale. Meister also loves the company’s lucrative dividend yield of 9.2% and sees as much as 70% upside potential in the stock, in addition to lots of downside protection. Corvex filed a 13D yesterday revealing a 5.5% stake in the company. Shares have gained 5.98% this week.

Larry Robbins, Glenview Capital Management – DXC Technology Company (NYSE:DXC), FMC Corp (NYSE:FMC), Quintiles IMS Holdings Inc (NYSE:Q)

Robbins pitched three stocks that were in what he deemed to be “regulatory purgatory”, citing that the FTC is taking longer than ever to review deals. He likes DXC Technology Company (NYSE:DXC), which resulted from a tie-up between Hewlett Packard’s services unit and CSC, for its good management and partnerships with innovative companies.

On FMC Corp (NYSE:FMC), he thinks they got a steal when they bought the businesses that Dow Chemical Co (NYSE:DOW) and E I Du Pont De Nemours And Co (NYSE:DD) were forced to divest for the completion of their merger for $3 billion, believing they were worth twice that.

In the case of Quintiles IMS Holdings Inc (NYSE:Q), he likes Quintiles’ merger with IMS Health, believing that it unlocks significant synergies.

DXC Technology Company (NYSE:DXC) has gained 1.03% this week, while FMC Corp (NYSE:FMC) is 0.6% in the red, and Quintiles IMS Holdings Inc (NYSE:Q) has posted 1.35% gains.

Brad Gerstner, Altimeter Capital – United Continental Holdings Inc (NYSE:UAL)

Gerstner is a huge United Continental Holdings Inc (NYSE:UAL) bull, believing the stock could double or even triple in value. He cited the fact that millenials are more frequent travelers than their ancestors, making airlines a secular growth story. He also thinks that airlines now have much better pricing power as capacity has nearly maxed out. Gerstner cited the fact that Warren Buffett has done a complete 180 on airline stocks as being proof positive that they’ve entered a new age as investment opportunities, having been trading at ridiculously low multiples due to pervasive negativity. United Continental Holdings Inc (NYSE:UAL) has gained 4.97% this week.

Clifton Robbins, Blue Harbour Group – Investors Bancorp, Inc. (NASDAQ:ISBC)

Clifton Robbins pitched Investors Bancorp, Inc. (NASDAQ:ISBC), the fund’s third-largest position at the end of 2016. He noted that the company will benefit tremendously from tax reform, as it’s currently a full tax-payer (36%), and that the fund will work with the company’s board (on which it has a member) “to explore the highest use” of its excess capital of about $1 billion. Robbins also believes the company is a potential takeover target. Robbins sees as much as 50% upside in shares of Investors Bancorp, Inc. (NASDAQ:ISBC), which have gained 2.3% this week.

That wraps up our coverage of yesterday’s event. If you missed it, check out our feature on Tesla Inc (NASDAQ:TSLA) published earlier today, which includes comments from Social Capital’s Chamath Palihapitiya, who pitched Tesla 2022 convertible bonds yesterday. The next Sohn event takes place June 5 in India.

Disclosure: None