“The worst is yet to come,” Icahn says, while cautioning that “inflation is a terrible thing” and “you can’t cure it.”

That said, he doesn’t suggest you should bail on stocks completely.

“I think a lot of things are cheap, and they’re going to get cheaper,” he says.

Given Icahn’s massively successful career as an investor, people want to know where he sees opportunity right now.

“I’m just curious what stocks look cheap and viable right now,” an audience member asked him during the Q&A session.

Icahn provided two names.

CVR Energy (CVI)

Energy was by far the S&P 500’s best-performing sector in 2021, returning a total of 53% vs the index’s 27% return. And that momentum has carried into 2022.

Year to date, the Energy Select Sector SPDR Fund (XLE) is up a solid 62%, in stark contrast to the broad market’s double-digit decline.

Icahn’s pick in the energy space is CVR Energy (CVI), which is mainly in the refinery business. He says that the stock “is quite cheap, even though it’s come up a lot.”

According to the latest 13F filing, Icahn held 71.2 million shares of CVR Energy at the end of September, worth approximately $2.06 billion at the time.

The position has servied the billionaire investor quite well as CVR Energy shares have surged 126% year to date.

As you’d expect from this kind of share price performance, the company is firing on all cylinders.

In Q3 of 2022, CVR Energy brought in $2.7 billion of net sales, up from $1.9 billion in the year-ago period.

The business got more lucrative, too, as the refining margin per total throughput barrel improved to $16.56 in Q3, compared to $15.03 in the same period last year.

The company recently declared a special dividend of $1.00 per share — on top of its regular quarterly cash dividend of 40 cents per share.

Ichan also likes the business because “you can't build another refinery in this country.”

Fine wine is a sweet comfort in any situation — and now it can make your investment portfolio a little more comfortable, too. Now a platform called Vinovest helps everyday buyers invest in fine wines — no sommelier certification required.

Invest Now

CVR Partners LP (UAN)

CVR Partners is a master limited partnership created by CVR Energy to own, operate, and grow its nitrogen fertilizer business.

While the two entities are related — CVR Energy subsidiaries own 37% of the common units of CVR Partners — CVR Partners is also publicly traded. Its ticker symbol is UAN.

“[The] fertilizer business, to me, is a great business today,” Icahn says.

CVR Partners’ manufacturing facilities primarily produce ammonia and urea ammonium nitrate (UAN) fertilizers, and those things are in strong demand.

In Q3, the partnership’s average realized gate price for UAN shot up 42% year over year to $433 per ton. For ammonia, the average realized gate price rose 65% year over year to $837 per ton.

Unsurprisingly, CVR Partners has been another stellar performer in this ugly market as the stock is up 38% year to date.

It’s easy to see why the business is appealing to Icahn.

“You need fertilizer if you want to eat,” he says.

Indeed, if you want the ultimate hedge against all the uncertainties the world is facing today, agriculture deserves a serious look, even if you know nothing about farming.

Get a piece of commercial real estate

Enhance your portfolio with high-return commercial real estate

First National Realty Partners is the #1 option for accredited investors seeking superior risk-adjusted returns in the grocery-anchored necessity-based retail space.

While commercial real estate has always been reserved for a few elite investors, outperforming the S&P 500 over a 25-year period, First National Realty Partners allows you to access institutional-quality commercial real estate investments — without the leg work of finding deals yourself.

Invest with First National Realty Partners now.

About the Author

Jing Pan

Jing Pan

Investment Reporter

Jing is an investment reporter for MoneyWise. He is an avid advocate of investing for passive income. Despite the ups and downs he’s been through with the markets, Jing believes that you can generate a steadily increasing income stream by investing in high quality companies.

What to Read Next

Disclaimer

The content provided on MoneyWise is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter.