Seventy-four-year-old Carl Icahn has been on the Wall Street scene awhile. Aside from amassing a significant fortune as an “activist investor” over the past several decades by purchasing large shares of publicly traded companies and winning seats on the boards of those he feels may be headed down the wrong path, Icahn has generated plenty of controversy — enough to fill an entire big-budget Hollywood movie.
In fact, Icahn’s personality of someone buying into companies at low rates and finding ways to turn massive profits, even if it means shaking up the board of directors and selling off large firms piecemeal into much smaller ones, recalls no one so much as Gordon Gecko from the Oliver Stone film “Wall Street.” Take away Michael Douglas’ slicked-back hair and chiseled chin, and you might find someone resembling Icahn himself.
With the Oscars coming up this Sunday, Icahn seems an interesting topic for the investor looking for new ideas. He is currently attempting to increase his share of Lions Gate Entertainment (LGF), a publicly traded production and distribution company with more than 500 titles to its credit, from 18.9% to 29.9%. Along with this, Icahn wants a lot more say in the way Lions Gate is run.
Ask any long-term investor of Motorola (MOT) or Yahoo! (YHOO) what Icahn’s involvement may mean. The man has been as dramatic a part in those companies’ fortunes as Marlon Brando has been in any of his films.
Lions Gate has been publicly traded since the late 1990s, and currently distributes the Oscar-nominated feature film “Precious,” which is up for Best Picture, Best Supporting Actress and four other major Academy Awards on Sunday. Lions Gate was also the distributor for Best Picture winner “Crash” in 2005, but the company may be best known for its involvement in the phenomenal success of 1999’s “The Blair Witch Project” — a film that cost $60,000 to make and brought in $141 million in U.S. box office.
According to the L.A. Times, Carl Icahn believes Lions Gate is wrongheaded in its interests to purchase struggling competitor Metro-Goldwyn-Mayer or Miramax, which is currently owned by The Walt Disney Company (DIS). And say what you want about Icahn the man, he knows enough not to pay too much for something he’s interested in.
That said, Lions Gate Films is currently rated a Zacks #5 Rank (Strong Sell). Clearly, Carl Icahn may have the stomach for a prolonged battle — like a 3 1/2-hour Akira Kurosawa film — but analysts, 7 of whom have downwardly revised estimates for 4th quarter 2010 (ending March 31) and 9 who have lowered estimates for the year, apparently feel differently. Perhaps activist investing, like gruesome horror flicks, is not for the faint of heart.
Read the full analyst report on “LGF”
Read the full analyst report on “MOT”
Read the full analyst report on “YHOO”
Read the full analyst report on “DIS”
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