Mario Gabelli, other fund managers offer top picks for 2021

By: Jayson Derrick
Jayson Derrick
Jayson lives in Montreal with his wife and daughter, loves watching hockey, and is on a lifelong quest to… read more.
on Jan 24, 2021
Updated: Apr 16, 2021
  • Legendary fund manager Mario Gabelli is bullish on two infrastructure names.
  • He also likes exposure to sports teams and sports media companies.
  • Another fund manager is making the case for a large tobacco company.

Legendary billionaire fund manager Mario Gabelli is bullish on infrastructure stocks for the simple reason that advanced infrastructure is a net positive for the United States, he said on Fox Business’ “Barron’s Insight.”

Gabelli’s two infrastructure picks

Infrastructure upgrades and improvements will likely be an area of focus for Washington in 2021. It is important for businesses and individuals to have access to good bridges, good roads, and good broadband, he said on Fox.

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Gabelli, along with several other fund managers, expressed their top picks for 2021 in a Barron’s feature.

The two picks in the infrastructure space Gabelli likes include: 1) GCP Applied Technologies Inc (NYSE: GCP), a provider of construction products technologies that include additives for cement and concrete, and 2) Hyster-Yale Materials Handling Inc (NYSE: HY), a maker of lift trucks.

GCP, also known as Grace Construction Products, will likely benefit from activist investor Starboard Value’s strong presence at the company, he said. The case for Hyster-Yale is based in part on management’s focus on hydrogen power for its forklifts. 

Gabelli picks betting and sports

Investing looking for exposure in the sports universe should consider buying shares of specific teams, such as the Madison Square Garden Sports Corp. (NYSE: MSG) that owns iconic franchises like the NBA’s New York Knicks.

Gabelli is well nown in the sports investment category. Here is an Invezz summary of two picks from January 2020.

Investors also need to look for media companies that own the rights to broadcast sports. Most notably, Sinclair Broadcast Group Inc (NASDAQ: SBGI) bought Fox’s sports business in 2019. In late 2020, Sinclair reached a deal with casino operator Bally’s corp (NYSE: BALY) to rename the sports network as Bally Sports.

The deal helped push Bally’s stock from around $30 a share to its current level above $50.

The integration of sports with sports betting means sports fans will likely spend more time watching games and this by default attracts more marketers, Gabelli said.

Tobacco play: Phillip Morris

Ariel Investments Chief Investment Officer Rupal Bhansali said in Barron’s feature that her top pick for 2021 is cigarette and tobacco manufacturing company Philip Morris International Inc. (NYSE: PM).

Philip Morris is the “Tesla of tobacco” given its revolution in the space with its IQOS product. IQOS heats specially designed tobacco without combustion, fire, or ash so consumers get their nicotine fix without the smoke.

The stock offers a dividend yield north of 5% so investors will get paid to wait and see if its IQOS wins in the long-term.

Scott Black is the founder and president of Delphi Management. His top pick as discussed in Barron’s is Magna International Inc. (NYSE: MGA), a supplier of components to the auto sector. Magna makes exterior parts for cars and can sell its equipment to traditional automakers and new-age electronic ones.

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