"Tracking Carl Icahn’s Portfolio – Q1 2016 Update"
"Carl Icahn’s US long portfolio decreased from $29.44B to $21.49B this quarter.Apple Inc. was dropped and Nuance Communications and PayPal Holdings were decreased substantially during the quarter.Icahn netted $2B in gains from the Apple exit.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 05/16/2016. Please visit our  to get an idea of his investment philosophy and our  for the fund’s moves during Q4 2015.This quarter, Icahn’s US long portfolio decreased ~27% from $29.44B to $21.49B. The number of holdings decreased from 26 to 21. The portfolio is very concentrated with the largest five positions accounting for ~68% of the entire holdings: Icahn Enterprises, American International Group, CVR Energy Inc., PayPal Holdings and Federal Mogul.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:Apple Inc. (AAPL): The huge 16.36% of the portfolio stake in AAPL was established in mid-August 2013 at around $68 per share. The original position was increased by ~22% in Q4 2013 and the following quarter saw another ~60% increase at prices between $57 and $80. Last quarter saw an about turn: ~13% reduction at prices between $105 and $123. The entire position was sold this quarter at prices between $93 and $110. The stock currently trades at $94.20. Icahn harvested $2B in gains over the three-year holding period.Gannett Inc. (GCI) previously Gannett SpinCo: GCI was a very small 0.36% of the US long portfolio stake established in Q2 2015 as a result of  Gannett’s Tegna Inc. spin-off and rename transaction that closed in June 2015. Last quarter saw a ~13% trimming. The elimination this quarter was at prices between $14.03 and $16.74.Note: The publishing business (owns USA Today and 90+ local daily publications) was spun-off and named Gannett Inc. while the parent company was renamed Tegna Inc. The terms called for shareholders of the parent to receive shares of the spinoff in the ratio 1:2.Hologic Incorporated (HOLX): HOLX was a 3.70% of the US long portfolio activist stake established in Q4 2013 at around $21 per share. Last quarter saw a ~18% reduction at prices between $37.22 and $42.92 and the elimination this quarter was at prices between $32.42 and $38.69. The stock currently trades at $33.28. Icahn harvested large long-term gains.Note: Icahn nominated two representatives to the board and in December 2013 a new CEO (Stephen MacMillan formerly of Stryker) was appointed. Since then, most of the upper management was replaced as well.Mentor Graphics (MENT): MENT was a relatively small ~1% of the portfolio stake as of last quarter. As a percentage of the business, the position was very significant at ~14%. The entire stake was eliminated this quarter at prices between $18 and $20. The stock currently trades at $19.36.Pep Boys Manny Moe & Jack (PBY): Following a bidding war with Bridgestone, Icahn agreed to buy PBY at $18.50 cash and that transaction closed in January. The small 0.41% 13F position as of last quarter was thus eliminated.Tegna Inc. (TGNA) previously Gannett: Icahn held 12.77M shares (5.8% of the business) of TGNA at a cost-basis of around $25 as of last quarter. The original stake was from Q2 2014 with the bulk purchased the following quarter. Last quarter saw a ~15% reduction at prices between $22.39 and $28.68. The elimination this quarter was at prices between $21.37 and $25.52. The stock currently trades at $22.22.Note: The cost-basis quoted above is adjusted for the publishing business spinoff that closed in June 2015.New Stakes:Manitowoc Food Service (MFS): The very small 0.73% 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 $15.69 which is very close to Icahn’s cost-basis. He controls 7.73% of the business.Stake Decreases:Nuance Communications (NUAN): NUAN is a 2.62% 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 $18.31 and $20. This quarter saw an about turn: ~50% stake reduction at prices between $16.15 and $20.53. The stock is now at $16.18. Icahn’s ownership is currently at 9.88% (~30M shares).PayPal Holdings (PYPL): PYPL is a fairly large (top five) 6.80% of the 13F portfolio position. It was established as a result of the spinoff of PayPal Holdings from eBay Inc. that closed in July 2015. Icahn sold the eBay stake but held on to the PayPal position. The stock currently trades at $37.65.Stake Increases:American International Group (AIG): AIG was a minutely small 0.28% portfolio stake as of Q3 2015. It was increased to a top five position last quarter at prices between $57 and $64. The stock currently trades just below that range at $56.36. This quarter also saw a ~5% increase and the stake is now at 11.18% of the portfolio. It is an activist position and Icahn’s ownership interest is at ~3.9%. For investors attempting to follow Icahn, AIG is a good option to consider for further research.Xerox Corporation (XRX): XRX is a fairly large 4.80% of the portfolio position established last quarter at prices between $9.29 and $10.88 and increased by ~7% this quarter at prices between $8.69 and $11.16. The stock is now at $9.06. For investors attempting to follow Icahn, XRX is a good option to consider for further research. Icahn controls ~10% of the business.Note: XRX is an activist stake and Icahn got three board seats earlier this year. Xerox also announced plans to split into two companies.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, and to ~117M shares in 2015. The last big increase happened in 2012 when around 20M shares were purchased at prices between $36.50 and $42.50. The stock currently trades at $53.92.Note: Regulatory Form 4 & 13D/A filings on 4/14/2016 shows Icahn added 2.77M shares after the quarter ended at $60.88. Including that, the ownership is now at 120.5M shares (89.75% of the business).Kept Steady:CVR Energy Inc. (CVI): CVI is a huge (top three) 8.65% of the US long portfolio position first purchased in Q4 2011. The bulk of the current position (71.2M shares: 80% of the whole business) was purchased through a $30 per share tender offer in H1 2012. The stock currently trades at $20.48.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).CVR Refining LP (CVRR): CVRR is a small 0.34% 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 well below that range at $10.51.Cheniere Energy (LNG): LNG is a large 5.15% portfolio position. The bulk of it was purchased in Q3 2015 at prices between $47.47 and $70.65. Last quarter saw a ~15% increase at prices between $36 and $54. The stock currently trades below the low end of those ranges at $32.88. Icahn’s ownership stake in the business is ~14%.Note: LNG has strong recent super-investor interest: Seth Klarman (Baupost Group), John Griffin (Blue Ridge Capital), and Stephen Mandel (Lone Pine Capital) have established large stakes.Chesapeake Energy (CHK): CHK was first purchased in 2010 but was quickly sold. The bulk of the current stake was purchased in Q2 2012 at prices between $14.50 and $23. Q1 2015 saw a ~10% increase at prices between $13.50 and $21.26. The stock currently trades well below those ranges at $3.88. The ownership stake in Chesapeake is at ~11% (~73M shares).Note 1: Icahn successfully engaged in a proxy fight alongside Southeastern Asset Management that led to the eventual departure of the CEO.Note 2: The implied performance of this stake by the prices quoted above is negatively skewed because of the spinoff of Seventy Seven Energy (SSE), its Oilfield Services business unit. The terms of the deal called for CHK shareholders to receive one share of SSE for every 14 shares of CHK held.Federal Mogul (FDML): FDML is a very long-term 6.37% stake 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. The stock currently trades at $8.25. Q1 2015 saw a ~14% increase at prices between $12.61 and $16.09. Icahn controls ~82% of the business.Note: A regulatory 13D filing on 2/29/2016 showed an Icahn offer to acquire the company for $7 per share.Freeport-McMoran Inc. (FCX): FCX is a 5.01% of the portfolio stake established in Q3 2015 at prices between $7.92 and $18.62. The stock currently trades at $10.98. Icahn controls ~10% of the business.Herbalife (HLF): HLF is a 4.87% of the US long portfolio stake first purchased in Q1 2013 in the high-30s price range. The position was marginally increased in Q2 2013 to almost 17M shares. The stock currently trades at $59.51.Note: Herbalife is being investigated by the FTC (Civil Investigative Demand - CID). Recent indications from the company suggest they may be close to a resolution.Hertz Global Holdings (HTZ): HTZ is a 3.12% of the US long portfolio position. It was established in Q3 2014 at a cost-basis of $28.35. In Q4 2014, the stake was increased by just over one-third at prices between $19.38 and $25.47. Last quarter saw another ~23% increase at prices between $13.70 and $19.85. The stock currently trades at $8.40. Icahn owns 14.34% of the business. For investors attempting to follow Icahn, HTZ is a good option to consider for further research.Manitowoc Company (MTW): MTW is a very small 0.21% of the portfolio activist stake. It was established in Q4 2014 at prices between $3.76 and $5.22 and increased by ~136% in Q1 2015 at prices between $4.01 and $5.17. The stock currently trades at $5.59. For investors attempting to follow Icahn, MTW is a good option to consider for further research.Note: The prices quoted above are adjusted for Manitowoc Food Service spin-off.Navistar International (NAV): NAV is a relatively small 0.95% of the US long portfolio long-term position. Recent activity follow: ~12% increase in Q3 2013 at prices between $27.50 and $40 and another ~22% increase in Q2 & Q3 2014 at prices between $29 and $38. The stock currently trades at $10.66. Icahn controls ~20% of the business.Seventy Seven Energy (SSEI): SSEI is a minutely small 0.01% of the US long portfolio position established in Q3 2014 as a result of the spin-off of SSEI from Chesapeake Energy. Chesapeake Energy shareholders received one SSEI share for 14 Chesapeake Energy shares held. Icahn’s stake is consistent with that ratio. The OTC stock currently trades at 9c. Icahn controls 9.34% of the business. Last month, the company indicated plans to file for bankruptcy.Transocean Ltd. (RIG): RIG is a small ~0.91% of the US long portfolio stake first purchased in Q4 2012 at prices between $44.20 and $49.50. The position was increased by ~250% in Q1 2013 at prices between $44 and $60. The stock currently trades well below those ranges at $9.07.Voltari Corporation (VLTC): VLTC position was increased by ~600% in Q1 2015 to a 52.3% ownership stake. As a percentage of the portfolio, the position is still minutely small. The stake increase came about from Voltari’s rights offering in February: 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 $3.50.American Railcar Industries (ARII) and Enzon Pharmaceuticals (ENZN): These are relatively small (less than 2% of the US long portfolio) positions that were held steady this quarter.  Although the stakes are small on a relative basis, the ownership interests are very significant: Icahn owns 60.31% of ARII and 13.7% of ENZN.Note: Icahn also owns significant stakes in the following OTC stocks as per latest 10Q: ~73% of Viskase Companies (VKSC) and ~68% of Tropicana Entertainment (TPCA).The spreadsheet below highlights changes to Icahn’s US stock holdings in Q1 2016:Form 3/4, 13G/D/A Filing thru 2/20/2016: MENT - 2/19/2016 Form 4 & 13D/A - 8.06M shares sold at $8.12 - 8.06M shares - 6.86%. PBY - 2/8/2016 13D/A - 45.91M shares - 84.5%. 39.35M shares tendered at $18.50 and the remaining and the remaining 8.4M shares cancelled in connection with merger. XRX - 1/29/2016 13D/A - 92.38M shares - 9.12%. GCI - 1/13/2016 13D/A - 5.38M shares - 4.66%. MTW - 1/4/2016 13D/A -minor amendment ot 2/2015 settlement agreement. MSTX - 12/30/2015 13D/A - 0. IEP - 12/29/2015 13D/A -117M shares - 89.04%. LNG - 12/22/2016 Form 4 - 2500 purchase @ $35.88. 12/8/2015 Form 4 - 30.84K shares @ $41.84. 12/7/2015 Form 4 - ~2.9M shares acquired at ~$42. HTZ - 12/7/2015 Form 4 & 13D/A - 11.79M shares acquired @ $14.23. 63.71M shares total - 14.34%.Note: : After a bidding war with Bridgestone, Icahn agreed to buy PBY at $18.50 cash.Note: : WSJ reported that Icahn said he owns ~42M shares (~$2.61B - 3.4% stake) of AIG. Paulson & Icahn are urging for a 3-way split-up (life, property-and-casualty and mortgage) with the idea that each one will be small enough to avoid the Systemically Important Financial Institution label that comes with tougher regulations and capital requirements - the contention is that, the tougher regulations in turn undermines AIG’s ability to grow. They also want cost-cuts."