Santangel's Review

Commentary

2011 Ira Sohn Conference Notes

This year’s conference was packed with interesting speakers. David Einhorn made news with his call for Steve Ballmer to leave Microsoft, and for his cryptic cry “Let’s Go Mets!” at the end of his presentation. Here is a summary of the speakers’ recommendations:

 

Erez Kalir of Sabretooth:
  • Long MBIA credit and equity. The market thinks the company is dead, but the market is wrong.
  • Argentina oil and gas exploration. The market thinks the country and the sector are dead. The market is wrong.
  • Farmland outside of the US. The best hedge against the US hyperinflation scenario.
Dinakar Singh of TGP/Axon:
  • Orkla, Norwegian conglomerate that’s being restructured.
  • Zhongpin, Chinese pork processor that will benefit from consolidation.
  • Sprint Nextel. Cheap large cap restructuring story.
Jeff Aronson of Centerbridge:
  • Long CIT equity. Misunderstood by the Street, could be bought by a bank or buy a bank itself, John Thain is doing a good job.
Robert Howard of KKR:
  • WABCO, global supplier of auto parts components.
  • HSNI, part of home shopping duopoly.
Phil Falcone of Harbinger:
  • Lightsquared (his 4G spectrum play). Not public yet but will be when capital markets permit.
  • Crosstex XTXI. Excellent way to play higher oil prices.
Jim Chanos of Kynikos:
  • Short solar and wind producers like Vestas and First Solar
Michael Price
  • Likes Goldman, Citi, B of A, CIT, JC Penney, Becton Dickinson.
Sunjay Gorawara, MBA student at the University of Indiana, winner of the Ira Sohn Idea Contest:
  • Long Bridgepoint Education. An overlooked for-profit education company that’s actually good.
Steven Feinberg of Cerberus:
  • Long selective residential MBS.
Peter May of Trian (Nelson Peltz’s partner):
  • Long Tiffany, which he’s on the board of. One of the world’s best brands, deserves a premium multiple.
Steve Eisman of Frontpoint:
  • Long property casualty commercial lines insurers and brokers like Aon, Willis, and MarchMac. Prices will turn.
Jeff Gundlach of TCW:
  • cash, energy and natural gas, gold, gemstones.
Marc Faber:
  • In the runaway money-printing scenario, own hard assets, real estate, equities, commodities, precious metals.
Bill Ackman of Pershing Square:
  • Long Family Dollar, playing catchup to Dollar General.
Joel Greenblatt of Gotham Asset Management:
  • Value stocks in the Russell 2000 are cheap.
  • Some stocks that show up in his formulas: Wellpoint, Coventry Healthcare, Amerigroup, Aetna, Humana, Gamestop, Walgreen, Beth Bath and Beyond, Nordstrom, Williams-Sonoma, Intel, McGraw-Hill, Merck, Abbott Labs.
Mark Hart III of Corriente Advisors (Kyle Bass’ partner):
  • Long renminbi puts, a non-consensus bet on what would happen (currency would be devalued) if China’s credit bubble bursts.
David Einhorn of Greenlight Capital:
  • Long Delta Lloyd, Dutch insurer.
  • Long Microsoft, but Steve Ballmer needs to go.
Eike Batista of EBX:
  • Long EBX, his natural resources conglomerate in Brazil.
Carl Icahn:
  • Long Icahn Enterprises. Will be his investment vehicle going forward now that he’s shut down his hedge fund.