The biggest names in the investing world have the gravitas to move stock prices with as little as a word. And two of the industry's biggest guns, David Einhorn and Bill Ackman, are presenting their top long or short ideas at next week's Value Investing Congress. Einhorn has made a big name for himself over the past couple of years, wowing the crowds with intensely detailed short cases on Florida real estate play St. Joe and Green Mountain Coffee Roasters.
The world is waiting to hear what these heavy hitters have to say. That's why we're attending in New York and will be covering the goodness here on Fool.com. We've got our guesses at the most important themes of this year's congress, but here are some specific stock ideas we think the gurus might talk up.
Joe Magyer, Inside Value: I'm betting at least one of the biggies at the VIC will talk up ways to play spiking interest rates -- a contrarian play that could raise the tide under the boats of discount brokerages like TD AMERITRADE
Another favorite could be General Motors
Bryan Hinmon, CFA, Motley Fool Pro: Value investors have been banging the bank bargain bongos for some time now, but investors remain wary. The reason? Heightened regulation has increased costs and restricted participation in some business lines, forcing banks to remold their operations and figure out new ways to earn high returns on equity. Companies that help banks focus on their core businesses and shed noncore functions could be the key to making those bank bets pay off -- but investors still have to choose the right bank to bank on.
An easier case can be made for Broadridge Financial Solutions
Michael Olsen, CFA, Motley Fool Special Ops and Million Dollar Portfolio: Talk of inflation -- in commodities and food, in particular -- has been a hot potato amid the QE Infinity. But amid a historic drought, concerns over sputtering Asian giants, and a world economy that hangs in the balance, PotashCorp
Though the near-term's a bit iffy, PotashCorp has the wind at its back. Global consumption of proteins, fruits, and vegetables is poised to continue growing. Cattle, in particular, require a lot of feed grain, and exponentially higher use of fertilizer. According to a recent Tyson Foods presentation, a pound of chicken requires two pounds of grain, and a pound of pork and beef require 3.5 pounds and seven to nine pounds, respectively. And despite a fairly rapid, recent increase in protein consumption, one country's been conspicuously absent from the party: India. With a population of more than a billion, at 2010's end, its per capita protein consumption was just about a a seventh of China's.
Add investments in Sociedad Quimica y Minera, Israel Chemical, Arab Potash, and Sinofert worth about 25% of its market cap before taxes -- whose value the market doesn't seem to fully appreciate -- and PotashCorp starts to resemble that rare, wonderful confluence of growth and value.
Joel South, Fool.com energy editor: "Buy when others are fearful" is a mantra often repeated by value investors. That's easy enough on paper, but the best identify industries facing significant headwinds in the short term, and plow down to find the hidden gem in the heap. Investors have deserted anything natural gas. Advances in horizontal drilling and improved hydraulic fracturing, an uncharacteristically warm winter, and a drill-at-any-cost mentality (among producers) contributed to a huge supply glut, and accordingly depressed gas prices. With the differential between oil and natural gas increasing, so too are the opportunities to purchase deeply discounted companies.
Firms like Devon Energy
We'll be posting our analysis of the latest and greatest from the congress next week, so stayed tuned to these pages.
If the idea of seeing Bill Ackman and David Einhorn in the flesh is just too tempting, feel free to join us. Motley Fool readers can attend the Value Investing Congress with a $300 discount. Click here to learn more, and be sure to enter the discount code FOOLN12.
Joe Magyer; Bryan Hinmon, CFA; Michael Olsen, CFA; and Joel South all contributed to this report.
Joe Magyer owns shares of General Motors and TD AMERITRADE. None of the other writers owns shares of the companies they mentioned in their respective portions of this article. The Motley Fool owns shares of Devon Energy. Motley Fool newsletter services have recommended buying shares of General Motors, TD AMERITRADE, and Devon Energy, as well as writing puts on TD AMERITRADE. The Motley Fool has a disclosure policy.