"Tracking Carl Icahn’s Portfolio – Q4 2016 Update"
"Carl Icahn’s US long portfolio value increased from $19.80B to $22.37B this quarter.Freeport-McMoran was reduced while increasing Herbalife and Hertz Global Holdings.Icahn Enterprises, American International Group, and CVR Energy are the three largest positions.This article is part of a series that provides an ongoing analysis of the changes made to Carl Icahn’s US stock portfolio on a quarterly basis. It is based on Icahn’s regulatory  filed on 02/14/2017. Please visit our  to get an idea of his investment philosophy and our  for the fund’s moves during Q3 2016.This quarter, Icahn’s 13F portfolio value increased ~13% from $19.80B to $22.37B. The number of holdings decreased from 19 to 18. The portfolio is very concentrated with the largest five positions accounting for over two-thirds of the entire holdings: Icahn Enterprises, American International Group, CVR Energy (CVI), Federal Mogul, and Cheniere Energy.Carl Icahn is best known for building sizable stakes in businesses and then pushing for changes to increase shareholder value. To learn more about his investing style and philosophy check out “”.Note: Icahn’s 13F filing is a consolidated report and so should not be viewed as a single portfolio. Specifically, Icahn Enterprises holds several of the businesses and the entities in turn hold Icahn Enterprises. For an idea on the business structure, check-out  (Slide 9).Stake Disposals:None.Note: The minutely small position in Voltari Corporation (VLTC) as of last quarter is no longer listed in the 13F. This is probably because Voltari was delisted from NASDAQ in December and so as an OTC stock is no longer a 13F security. Icahn’s original VLTC stake was increased by ~600% in Q1 2015 to a 52.3% ownership stake. As a percentage of the portfolio, the position was still minutely small. The stake increase came about from Voltari’s rights offering in February 2016: 95% of the issued shares were acquired by Icahn by making use of the oversubscription privilege at a cost-basis of $1.36. The stock currently trades at $1.92.New Stakes:None.Stake Decreases:PayPal Holdings (PYPL): PYPL is a fairly large (top five) ~6% of the 13F portfolio position. It was established as a result of the spinoff of PayPal Holdings from eBay Inc. (EBAY) that closed in July 2015. Icahn sold the EBAY stake while keeping the PYPL position steady. Last year saw selling in PYPL as well: Q2 & Q3 2016 had seen a combined ~30% reduction at prices between $34 and $40.50 and that was followed with a minor trimming this quarter. The stock currently trades at $41.96.Freeport-McMoran Inc. (FCX): FCX is a fairly large 5.38% of the portfolio stake established in Q3 2015 at prices between $7.50 and $18.50. This quarter saw a ~12% trimming at prices between $9.50 and $16.50. The stock currently trades at $14.91.Note: Icahn controls ~6.3% of the business.Nuance Communications (NUAN): NUAN is a 1.22% of the US long portfolio stake established in Q1 2013 at prices between $18 and $25. The position was increased by roughly two-thirds in Q3 2013 at prices between $18 and $20. Q1 2016 saw an about turn: ~50% stake reduction at ~$19 per share in a buyback transaction with Nuance. The following quarter saw another ~30% selling at prices between $14.50 and $19.50. Last quarter also saw a ~9% further reduction at prices between $14 and $16.50. The stock is now at $16.96. There was a ~6% further trimming this quarter.Note: Regulatory filings since the quarter ended show them owning 12.9M shares (4.4% of business). This is compared to 18.4M shares in the 13F.Stake Increases:Icahn Enterprises (IEP): IEP is a very long-term position that has seen consistent buying over the years. The position size saw increases from ~98M shares to ~102M shares in 2013, to ~109M shares in 2014, to ~117M shares in 2015, and to ~130M shares currently. The last big increase happened in 2012 when around 20M shares were purchased at prices between $36.50 and $42.50. Last year saw a ~10% increase at prices between $46 and $63.50. The stock currently trades at $55.98.Note: Icahn controls ~90% of the business. A capital raise using a rights offering was announced earlier this month.Herbalife (HLF): HLF is a ~5% of the US long portfolio stake first purchased in Q1 2013 in the high-30s price range. Last quarter saw a ~15% further increase at prices between $58 and $68 and that was followed with a similar increase this quarter at prices between $48 and $64. The stock currently trades at $61.23. The total outlay so far is $943M with an overall cost-basis of $41.91.Note: Icahn controls ~24% of the business.Hertz Global Holdings (HTZ): HTZ is a 2.82% of the US long portfolio position. It was established in Q3 2014 at a cost-basis of ~$105. In Q4 2014, the stake was increased by just over one-third at prices between $72 and $95. Q4 2015 saw another ~23% increase at prices between $51 and $74. This quarter saw another ~125% increase at prices between $21 and $40. The stock currently trades at $20. For investors attempting to follow Icahn, HTZ is a good option to consider for further research.Note 1: Icahn controls ~35% of the business. The total outlay so far is ~$1.85B and the market value is ~$600M.Note 2: The shares owned went down significantly in Q2 2016 because of the spinoff of Herc Holdings. The net position had a marginal increase after accounting for the spinoff ratio (3:15). The prices quoted above are adjusted for this transaction.Kept Steady:American International Group (AIG): AIG was a minutely small 0.28% portfolio stake as of Q3 2015. It was increased to a top-three position the following quarter at prices between $57 and $64. H1 2016 also saw a minor increase. The stock currently trades at $62.50. The stake is now at 13.32% of the portfolio. It is an activist position and Icahn’s ownership interest is at ~4%. For investors attempting to follow Icahn, AIG is a good option to consider for further research.CVR Energy Inc. (CVI): CVI is a fairly large ~8% of the US long portfolio position first purchased in Q4 2011. The bulk of the current position (71.2M shares: 82% of the whole business) was purchased through a $30 per share tender offer in H1 2012. The stock currently trades at $23.74.Note: Two MLPs were carved out since the 2012 tender: CVR Refining (CVRR) the refining portion and CVR Partners (UAN) the nitrogen fertilizer unit. CVR Energy owns 71% of CVR Refining and 53% of CVR Partners. In August 2015, CVR Partners agreed to merge with Rentech Nitrogen (RNF).Federal Mogul (FDML): FDML is a very long-term 6.39% stake (top five) first purchased in 2000. It went through an asbestos-claim related bankruptcy and emerged in 2007 with Icahn owning over 75% of the outstanding shares, as debt he owned got converted into equity. In Q3 2013, FDML had a rights offering and Icahn got 44M of the 51M shares in the offering at $9.78 per share. Q1 2015 saw a ~14% increase at prices between $12.50 and $16.Note: Icahn offered to acquire the rest of the company for $7 per share in February 2016, raised the offer to $8 per share in June, to $9.25 per share in September, and sealed the deal at $10 per share. The transaction closed last month.Cheniere Energy (LNG): LNG is a large (top five) ~6% portfolio position. The bulk of it was purchased in Q3 2015 at prices between $47.50 and $70.50. Q4 2015 saw a ~15% increase at prices between $36 and $54. The stock currently trades at $46.71.Note: Icahn’s ownership stake in the business is ~14%.Xerox Corporation (XRX): XRX is a fairly large ~4% of the portfolio position established in Q4 2015 at prices between $6 and $8. The stock is now at $7.44. For investors attempting to follow Icahn, XRX is a good option to consider for further research.Note 1: Icahn controls ~10% of the business.Note 2: XRX is an activist stake and Icahn got three board seats last year. Xerox spun-off Conduent (CNDT) and that transaction closed last month. The prices quoted above are adjusted for this. Regulatory filings show Icahn owning 19.8M shares (9.8% of the business). This is consistent with the 5:1 spinoff ratio.American Railcar Industries (ARII): ARII is a long-term 2.40% of the portfolio position held steady this quarter.  Icahn owns ~61% of ARII.Navistar International (NAV): NAV is a 2.28% of the US long portfolio long-term position. The last significant activity follow: ~22% increase in Q2 & Q3 2014 at prices between $29 and $38. The stock currently trades at $27.19.Note: Icahn controls ~20% of the business.Manitowoc Food Service (MFS): The very small 0.91% of the portfolio MFS stake was established as a result of the spin-off from Manitowoc. The spin-off terms called for one share of MFS for each share of MTW held. Icahn held 10.58M shares of MTW for which he received the same number of MFS shares. Regular-way trading started in early March with MFS at $13.41. It currently trades at $18.51 compared to Icahn’s cost-basis of ~$15.Note: Icahn controls ~8% of the business.Herc Holdings (HRI): HRI is a very small 0.77% of the portfolio position established in Q2 2016 as a result of the spinoff of Herc Holdings from Hertz Global Holdings. Following the transaction, there was a marginal increase in the position. The stock started trading at ~$33 and currently goes for $49.49.Note: Icahn controls ~15% of HRI.Allergan plc (AGN): AGN is a very small ~0.40% of the portfolio stake. It was established in Q2 2016 at prices between $202 and $278 and reduced by ~88% last quarter at prices between $230 and $260. The stock is now at $247.Manitowoc Company (MTW): MTW is a very small 0.28% of the portfolio activist stake. It was established in Q4 2014 at prices between $3.50 and $5.50 and increased by ~136% in Q1 2015 at prices between $4 and $5.50. The stock currently trades at $6.54.Note: The prices quoted above are adjusted for Manitowoc Food Service spin-off.CVR Refining LP (CVRR): CVRR is a minutely small 0.25% of the US long portfolio position established in Q1 2013 as a result of the spin-off (carve-out) of CVR Refining from CVR Energy. The position was increased by 50% in Q2 2013 at prices between $28 and $35. The stock currently trades at $10.95.Note: Icahn also owns significant stakes in the following OTC stocks as per latest 10Q and regulatory filings: ~15% of Enzon Pharmaceuticals (ENZN), ~73% of Viskase Companies (VKSC) and ~69% of Tropicana Entertainment (TPCA). He is also known to have a position in Fannie/Freddie (FNMA) (FMCC). Last month, Icahn also reached an agreement with ENZN not to increase ownership.The spreadsheet below highlights changes to Icahn’s US stock holdings in Q4 2016:- ARII spiked ~5% primarily due to confusion: “Confusion on ARL and ARII. ARL is 100% privately owned by Icahn. Nothing to do with ARII beyond production and maintenance agreements”Regulatory filings thru 11/20/2016: T/A 11/15/2016 - FDML - tender offer extension to December 15 @ $9.25 per share - first offered September. HTZ - 11/10/2016 Form 4 - ~1.2M shares @ ~$28.25 - 29.26M shares. 11/10/2016 - 13D/A - 16.33M shares acquired at a cost-basis of $24.16. Total 29.26M shares, 35.27% of business, 1.66B total cost, overall cost-basis - $56.73. 11/8/2016 - 13D/A - HLF - ~1M shares acquired at a coast-basis of $55.05. Total 22.5M shares, 24.18% of business, ~$943M total cost, overall cost-basis - $41.91 overall cost-basis. 11/3/2016 - 13D/A - 1.8M shares @ $54.7. 21.44M shares. 11/1/2016 13D/A -  TPCA - 17.86M shares - 68.75% of business. 10/31/2016 - 13D/A - ARII - 11.87M shares - 61.31%.$51M worth (6.8M of FNMA & 5.7M of FMCC - $4.08 combined cost basis) of Fannie/Freddie common stock from Bruce Berkowitz in March 2014. Might add this from Q3 2016 report onwards."