U.S. stocks are roughly unchanged on Friday, with the Dow Jones Industrial Average (DJINDICES:^DJI) and the benchmark S&P 500 (SNPINDEX:^GSPC) down 0.40% and 0.32%, respectively, at 1:45 p.m. EDT.

Over the past 12 months, two sectors have been reviled by the market: energy and materials. The rout in these sectors was ushered by a sharp decline in the price of many commodities, most prominently oil, as the stamina of the Chinese juggernaut faltered. As such, the energy and materials sectors are ripe to be picked over for value.

Carl Icahn

Billionaire investor Carl Icahn.
Source: www.insiderkonkey.com. Re-published under a Creative Commons license.

Last week, I wrote that patient investors ought to consider mining for long-term investment value at Glencore plc. Yesterday, it emerged that billionaire investor Carl Icahn has taken an 8.5% position in the world's largest publicly traded copper miner, Freeport-McMoRan. In the SEC filing disclosing the position, the motive for the purchase is one sensible investors can relate to: 

The Reporting Persons acquired their positions in the Shares in the belief that the Shares were undervalued.

That's a relief! (Just kidding: I wasn't expecting Icahn to say that he had spotted a head-and-shoulders shampoo pattern in Freeport's chart that indicated an imminent reversal in the stock's momentum.) 

True to his combative style, Icahn won't just sit around and hope that the market comes around to that view; instead, he will avail himself of other means to see the stock's value realized: 

The Reporting Persons intend to have discussions with representatives of the Issuer's management and board of directors relating to the Issuer's capital expenditures, executive compensation practices and capital structure as well as curtailment of the Issuer's high-cost production operations.

The filing also indicates that Icahn had not had any contact with the company as of Wednesday. As such, it appears that Freeport pre-empted Icahn with a Wednesday press release announcing a 29% reduction in mining and oil and gas capital expenditures to $4 billion and a 20% year-on-year reduction in unit site production and delivery costs in 2016. 

That announcement impressed the market -- the shares shot up 29% on Wednesday to $10.19. They are gaining several more percentage points today on news of Icahn's involvement. But this shrewd investor still has his work cut out for him; by my calculations, the cost basis of his position is $15.46 per share (incidentally, most of the position has been established through forward contracts). 

I think today's small pop undervalues Icahn's nose for value and his determination as an activist investor. Those who decide to ride his coattails are likely to do quite well over the next several years, in my opinion (just as they could have done with Apple). One doesn't accumulate $20 billion by making poor investments. 

If you're a value investor -- i.e., you like to buy stocks at a discount to their intrinsic value -- beaten-down, out-of-favor sectors are a natural place to look for stocks that fulfill that criterion. Why? Because sectors that fall out of favor generally do so for a good reason, initially. However, investors will often continue selling the sector past the point where it makes sense to do based purely on an economic calculus (assuming you think of risk as the possibility of a permanent impairment of capital rather than simply stock price volatility).

Beyond Freeport-McMoRan, I would suggest patient, value-oriented investors take a look at the commodities/energy sectors, starting with names such as Glencore, BHP Billiton, ExxonMobil, Chevron and Royal Dutch Shell.

Alex Dumortier, CFA has no position in any stocks mentioned. The Motley Fool owns shares of Freeport-McMoRan Copper & Gold,. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.