With a forecasted 70% chance of a 25-basis point hike at this month’s Fed meeting and the ongoing tech rally, it might be time to focus on picking individual stocks instead of investing in sectors. That’s the advice from billionaire investor Mario Gabelli, well-known for “loving unloved U.S. stocks” in an interview with Fox Business Network. As the Chairman and CEO of Gamco Investors, they create grids to track various stocks on management skill, profitability, and other fundamentals to choose which stocks to buy.
Gabelli highlighted the Atlanta Braves, which will spin off from a “tracking stock” to a C-corp on July 17th. That creates an opportunity for investors now, as the company will likely be sold to a top-notch buyer who recognizes its value. It’s that kind of catalyst that Gamco seeks out, generally looking about 2 years ahead. When looking for the “unloved” companies that have hidden potential, particularly in sports teams, Gabelli pointed to the Latino market as having plentiful opportunities, such as the Televisa network which is a $5 stock with 530 million shares and is very well-managed. Advertising for gambling is another area that Gabelli mentioned in the interview, as a change in the Professional and Amateur Sports Protection Act created a surge in advertising. Another area enjoying a resurgence post-pandemic is the leisure and travel sector, and demand for airplane parts is growing, Gabelli says. At the recent Paris Air Show, Boeing and Airbus projected that they will need 40,000 new airplanes within the next 20 years. In spite of issues that occasionally crop up, that provides a lucrative long-term opportunity for investors, particularly in vendors who supply parts to the bigger companies. In the interview, Gabelli highlighted commercial aviation supplier Crane Co., and Textron, a well-managed aerospace company which produces the replacements for the Black Hawk helicopters