26 Apr These are investor Mario Gabelli’s favorite value stocks
Billionaire investor Mario Gabelli is finding some value buying opportunities in this murky macroenvironment. During an interview with CNBC at the Morningstar Investment Conference in Chicago, the Gamco Investors CEO and chairman highlighted aircraft maker and defense contractor Textron as one of his favorite current stock picks. Providence, Rhode Island-based Textron is poised to benefit from the need to ramp up defense spending and improve antiquated systems that are “inappropriate for a hypersonic world,” Gabelli said. Textron traded near $66 during Wednesday trading. Due to its reasonable balance sheet, solid management and defense tailwinds, Gabelli said investors can make 50% on their investment in two years’ time. As the next wave of elections kick into full swing, the veteran investor views Tegna as a prime beneficiary of increased advertising spending. It also marks a “short term potential win” for investors awaiting a decision from the Federal Communications Commission on Standard General’s plan to take Tegna private, Gabelli said. TGNA YTD mountain Tegna’s performance so far in 2023 “You’re gonna have a tsunami of advertising,” he said. “The stock will earn over $3 [per share], the balance sheet will be improved, and you’ll get to $24.” Shares currently trade below $17 a piece. Finally, Gabelli highlighted Grupo Televisa SAB , a Latin American media company based in Mexico. The stock should benefit from growth in the Hispanic market, as advertising spending expands while candidates scramble to reach Spanish-speaking voters, and boost it relative Comcast -owned rival Telemundo for ad dollars. In 2021, Grupo Televisa agreed to sell its media and content division in a deal valued at $4.8 billion, while maintaining a stake in the newly formed TelevisaUnivision. A potential public offering in the next year and a half should also benefit Grupo Televisa, now trading under $5 a share, Gabelli said. These tailwinds combined should allow a potential triple return on the stock, he added. “If I take their earnings in Mexico, which will do okay, because they are cable operated there, you’re buying it at five and a half times cable earnings and then you get 45% of Univision for free,” he said. Disclosure: Comcast owns NBCUniversal, the parent company of CNBC