Tags: Gabelli | Media | Health | Energy

Mario Gabelli: Media, Health, Energy Look Attractive

By    |   Monday, 17 Feb 2014 10:35 AM

A rising tide does not always lift every boat. Some stock sectors simply hold more promise than others. GAMCO Investors Chairman Mario Gabelli, a Wall Street money manager whose firm manages $47 billion in assets, shared his ideas for the top sectors to invest in.

In an interview on FoxBusiness, Gabelli listed five big themes for investors to target –
media, health services, oil services, single-family housing and commercial aviation.

The media sector yields mostly big names that are attractive to Gabelli because they share a common business strategy. He likes his media picks because their practice is to “take cash flow to buy back stock. The remaining shareholders benefit.”

Editor’s Note: 18.79% Annual Returns . . . for Life?

He estimated 21st Century Fox shares could appreciate 50 percent in the next three to four years because of its active buyback program that he concludes will make the remaining shares more valuable.

Likewise, he predicted Viacom could appreciate from its current price of about $83 per share to $175 per share. “All they have to do is stay the course and not make bad use of cash flow,” he said.

Other media stocks he likes because of their aggressive share buyback programs are Discovery and DirectTV.

Gabelli specifically likes two sectors – health services and energy services -- because the U.S. has no choice but to focus on them in order to bring down its massive public debt.

“We like the fact that we as a country need to get our health care costs down,” he said.

He mentioned CVS Caremark, with its new decision to eliminate tobacco sales at its stores, as a company that is serving the public good in the health-care area.

Gabelli also mentioned domestic energy services, and in particular fracking, as an important avenue for cutting the trade deficit.

In a separate interview, he told Barron’s his choice in that area is Weatherford International, a company that makes fracking gear, and National Fuel Gas, which owns land where fracking occurs.

Editor’s Note: 18.79% Annual Returns . . . for Life?

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GAMCO Investors Chairman Mario Gabelli has five big themes for investors – media, health services, oil services, single-family housing and commercial aviation.
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