Lots of digital ink has recently been spilled about the disaster that is Carl Icahn‘s hedge fund. But not much has been discussed about what his possible plans for liquidation mean for the various stocks in his fund.
According to its latest 13F filing, Icahn’s hedge fund is comprised of 23 stocks, with a current value of $5,625,497,000. (Note: All dollar values and year-to-date performance calculations are accurate as of Wednesday, March 9, 2011.) But only three stocks comprise the majority of his portfolio: Motorola (MMI) is 34.57% of the portfolio, Genzyme Corp (NASDAQ:GENZ) is 13.26%, and Biogen Idex Inc (NASDAQ:BIIB) is 15.33%.
Worse, his worst-performing stock, Motorola, which is down 84.85% year-to-date, is his largest holding.
This very skewed portfolio has a weighted average return of -23.77% year-to-date versus the S&P 500′s return of 3.31%, for a deficit of -27.08%. To see this in more detail, refer to the table at the bottom of this article.
Some interesting statistics can be calculated from the data in the table at the bottom of this article. The mean position is $244,586,826, the median position is $65,389,000, and the maximum position, of Motorola (MMI) is $1,944,939,000. Meanwhile the smallest position is only $361,000.
The standard deviation of portfolio positions is $427,593,313, its skew is 3.08, and its kurtosis is 10.60. Very simply put this is a highly risky portfolio weighted toward three stocks, one of which (Motorola) has a beta of 1.65. A beta of 1.65 means that the stock is 65% more volatile than the market as a whole.
Here comes the interesting part. Of his 23 positions, 16 of them are larger than the average day’s trading volume for that particular stock. What this implies is that, in order to liquidate his holdings and return his money to his investors, he will either have to sell all at once (and drastically reduce the price of the shares he is selling) or negotiate with the company in question to buy its stock (assuming the company is willing and able to do so) or else find a private buyer for his equity positions. But any of these maneuvers will signal to people that supply of the stock is exceeding demand, and so prices will decline.
None of these are attractive options.
Following is some information about the stocks in Icahn’s portfolio, and links to our company pages so that you can do your own research.
- Adventrx Pharmaceuticals Inc (AMEX:ANX): ADVENTRX Pharmaceuticals, Inc. is a biopharmaceutical research and development company focused on introducing new technologies for anticancer and antiviral treatments. The Company’s products include CoFactor, Selone, and Thiovir.
- Amylin Pharmaceuticals Inc (NASDAQ:AMLN): Amylin Pharmaceuticals, Inc. is a biopharmaceutical company the discovers, develops, and commercializes medicines for diabetes and obesity. The Company’s marketed products include treatments for adults with type 1 and type 2 diabetes.
- Biogen Idec Inc (NASDAQ:BIIB): Biogen Idec Inc. develops, manufactures, and commercializes therapies, focusing on neurology, oncology, and immunology. The Company’s products addresses diseases such as multiple sclerosis, non-Hodgkin’s lymphoma, rheumatoid arthritis, Crohn’s disease, and psoriasis.
- Cadence Design System Inc (NASDAQ:CDNS): Cadence Design Systems, Inc. provides software technology, design and consulting services and technology. The Company licenses its electronic design automation software technology and provides a variety of professional services. Cadence’s design realization solutions are used to design and develop complex chi[s and electronic systems, including semiconductors.
- Chesapeake Energy Corp (NYSE:CHK): Chesapeake Energy Corporation produces oil and natural gas. The Company’s operations are focused on discovering, developing and acquiring conventional and unconventional natural gas reserves onshore in the United States.
- Commercial Metals Co (NYSE:CMC): Commercial Metals Company and its subsidiaries manufacture, recycle and market steel and metal products and related materials. The Company markets and trades primary and secondary metals, steel, ores, concentrates, industrial minerals, ferroalloys, chemicals, and other materials used in a variety of industries.
- Cyberonics Inc (NASDAQ:CYBX): Cyberonics, Inc. designs, develops, and markets medical devices. The Company’s devices are used for the treatment of epilepsy and other debilitating neurological, psychiatric, and other disorders. Cyberonics’ NCP System is approved for sale in the United States, Europe, Canada, and other markets.
- Dynegy Inc Del (NYSE:DYN): Dynegy Inc. provides electricty to markets and customers throughout the United States. The Company sells electric energy, capacity and ancillary services on a wholesale basis from its power generation facilities.
- Enzon Pharmaceuticals Inc (NASDAQ:ENZN): Enzon Pharmaceuticals, Inc. is a biopharmaceutical company that discovers, develops, and commercializes therapeutics to treat life-threatening diseases. The Company has developed several products, including PEG-INTRON. Enzon’s product-focused strategy includes a drug development program that leverages its PEG modification and single-chain antibody (SCA) technologies.
- Exelixis Inc (NASDAQ:EXEL): Exelixis, Inc. is a development-stage biotechnology company dedicated to the discovery and development of small-molecule therapeutics for the treatment of cancer and other serious diseases. The Company is building a portfolio of compounds it believes could become pharmaceutical products. Exelixis has strategic alliances with pharmaceutical and biotechnology companies.
- Forest Laboratories Inc (NYSE:FRX): Forest Laboratories, Inc. develops, manufactures, and sells both branded and generic forms of ethical products which require a physician’s prescription. The Company also manufactures non-prescription pharmaceutical products sold over-the-counter, which are used for the treatment of a wide range of illnesses. Forest’s products are marketed in the United States and Europe.
- Genzyme Corp (NASDAQ:GENZ): Genzyme Corporation is a global biotechnology company that develops products for people with serious diseases. The Company focuses on developing therapeutics for rare disorders, renal diseases, orthopaedics, cancer, transplant and immune disease, and diagnostic and predictive testing. Genzyme also provides diagnostic products and services.
- Hain Celestial Group Inc (NASDAQ:HAIN): The Hain Celestial Group, Inc. is a natural and organic beverage, snack, specialty food, and personal care products company. The Company’s product line includes grocery store foods such as organic cookies, cooking oils, sugar free products, kosher foods, snacks, and frozen foods as well as organic skin, hair, and body products. Hain Celestial sells and markets in North America and Europe.
- Lawson Software Inc (NASDAQ:LWSN): Lawson Software, Inc. provides enterprise software solutions targeting specific services industries. The Company provides financial management, human resources, professional services automation, procurement, distribution, and customer relationship management solutions. Lawson has customers in the healthcare, retail, professional services, public sector, and other industries.
- Lions Gate Entmnt Corp (NYSE:LGF): Lions Gate Entertainment Corp. develops, produces, and distributes filmed entertainment content. The Company’s divisions produce motion pictures, television programming, animation, and digital media. Lions Gate distributes its films and other media in the United States, Canada, and internationally.
- Masco Corp (NYSE:MAS): Masco Corporation manufactures, and sells home improvement and building products. The Company’s products include faucets, kitchen and bath cabinets, architectural coatings, and builders’ hardware products. Masco sells its products through mass merchandisers, home centers, hardware stores, and other wholesale and retail outlets to consumers and contractors.
- Mattel Inc (NASDAQ:MAT): Mattel, Inc. designs, manufactures, and markets a broad variety of children’s products on a worldwide basis. The Company sells its products to retailers and directly to consumers. Mattel’s products include branded fashion dolls, infant and preschool products, toy cars, and electrical vehicles, among others.
- Mentor Graphics Corp (NASDAQ:MENT): Mentor Graphics Corporation manufactures, markets, and supports software and hardware electronic design automation products. The Company provides related services which enable engineers to design, analyze, simulate, model, implement, and verify the components of electronic systems.
- Motorola Inc (MMI): Motorola, Inc. provides integrated communications solutions and embedded electronic solutions. The Company offers wireless handsets, wireless accessories, digital entertainment devices, wireless access systems, voice and data communications systems, and enterprise mobility products.
- Navistar Intl Corp New (NYSE:NAV): Navistar International Corproation manufactures and markets medium and heavy trucks, school buses, mid-range diesel engines, and service parts. The Company also provides financial services to its dealers and customers.
- NRG Energy Inc (NYSE:NRG): NRG Energy, Inc. owns and operates a diverse portfolio of power-generating facilities, primarily in the United States. The Company’s operations include energy production and cogeneration facilities, thermal energy production, and energy resource recovery facilities.
- Regeneron Pharmaceuticals (NASDAQ:REGN): Regeneron Pharmaceuticals, Inc. is a biopharmaceutical company that discovers, develops, and commercializes pharmaceutical products for the treatment of serious medical conditions. The Company has therapeutic candidates in clinical trials for the potential treatment of cancer, eye diseases, and inflammatory diseases, and has preclinical programs in other diseases and disorders.
- Take-Two Interactive Software (NASDAQ:TTWO): Take-Two Interactive Software, Inc. develops, markets, distributes, and publishes interactive entertainment software games and accessories. The Company’s products are for the personal computer, PlayStation game console, PlayStation 2 computer entertainment system, Xbox, Nintendo GameCube, and Nintendo Game Boy Advance. Take-Two operates offices worldwide.
|Company Name||Exchange:Ticker||$ Value in Icahn’s portfolio||# shares Icahn’s fund holds||% weighting in portfolio||YTD performance||Shares outstanding||% of outstanding shares that Icahn owns||Average trading volume||Icahn stake as % of average volume|
Take-Two Interactive Software
|Adventrx Pharmaceuticals Inc||AMEX:ANX||361,000||138,377||0.01%||-21.07%||14,700,000||0.94%||424,343||32.61%|
|Amylin Pharmaceuticals Inc||NASDAQ:AMLN||211,558,000||14,381,925||3.76%||-22.90%||144,430,000||9.96%||1,680,000||856.07%|
|Biogen Idec Inc||NASDAQ:BIIB||862,277,000||12,860,205||15.33%||6.99%||240,910,000||5.34%||1,980,000||649.51%|
|Cadence Design System Inc||NASDAQ:CDNS||2,938,000||355,686||0.05%||3.92%||288,490,000||0.12%||3,620,000||9.83%|
|Chesapeake Energy Corp||NYSE:CHK||541,017,000||20,880,627||9.62%||26.13%||657,630,000||3.18%||15,180,000||137.55%|
|Commercial Metals Co||NYSE:CMC||61,267,000||3,692,984||1.09%||-6.45%||114,470,000||3.23%||1,290,000||286.28%|
|Dynegy Inc Del||NYSE:DYN||53,952,000||9,600,001||0.96%||-1.78%||120,890,000||7.94%||2,470,000||388.66%|
|Enzon Pharmaceuticals Inc||NASDAQ:ENZN||57,490,000||4,723,891||1.02%||-15.05%||58,820,000||8.03%||404,415||1168.08%|
|Forest Labs Inc||NYSE:FRX||38,796,000||1,213,120||0.69%||1.00%||286,090,000||0.42%||2,550,000||47.57%|
|Hain Celestial Group Inc||NASDAQ:HAIN||144,807,000||5,351,331||2.57%||7.43%||43,020,000||12.44%||429,869||1244.87%|
|Lawson Software Inc New||NASDAQ:LWSN||125,633,000||13,581,946||2.23%||22.16%||163,620,000||8.30%||1,020,000||1331.56%|
|Lions Gate Entmnt Corp||NYSE:LGF||232,496,000||35,713,655||4.13%||-7.22%||136,740,000||26.12%||260,729||13697.62%|
|Mentor Graphics Corp||NASDAQ:MENT||154,755,000||12,896,232||2.75%||28.17%||109,670,000||11.76%||1,590,000||811.08%|
|Navistar Intl Corp New||NYSE:NAV||540,000||9,326||0.01%||6.54%||72,070,000||0.01%||1,440,000||0.65%|
|Nrg Energy Inc||NYSE:NRG||46,444,000||2,376,880||0.83%||-0.10%||247,540,000||0.96%||2,860,000||83.11%|