Billionnaire Investor Carl Icahn Posted His Worst Loss Since 2008
By Staff Writer
Mar 03, 2016 07:48 AM EST
Mar 03, 2016 07:48 AM EST
Activist investor Carl Icahn posted loss of $1.7 billion investment in 2015. The amount was down 18% from previous year, which also posted a loss at $221 million.
Carl Icahn is known as an activist investor, which using his power and influence to control company he invested in. So far, Icahn has a controlling position in many enterprises, including Federal-Mogul, XO Communications, Time Warner, Netflix, and AIG.
He is known as one of the top investors in Wall Street with more than 40 years of experience. Last year, Carl Icahn reported that his investment fund, which was operated by his Icahn Enterprises, dropped by 18%.
Loss in 2015 give a two-year in a row, as in 2014 his investment fund also fell by 7.4% with a $221 million loss. He incurred most of the 2015 loss in the fourth quarter with 15.6% loss. On Monday report, Icahn Enterprises reported an adjusted net loss of $1.2 billion in 2015.
In the fourth quarter alone, Icahn Enterprises posted a staggering 41.1 billion losses. Icahn Enterprises Chief Executive Officer Keith Cozza told CNBC in an conference call, "2015 was a challenging year to say the least. We are quite disappointed in our results."
Carl Icahn is renowned for his versatility in market. After a huge 36% loss in 2008, he bounced back very quickly. Gaining 33% in 2009 and two consecutive gain in 2010 and 2011 by 15% and 35%. He made a gain in 2011 when most hedge funds suffered loss.
According to USA Today, since its founding in 2004, Icahn's hedge fund, which also shorts stocks, has returned 171%, or 9% annualized.
S&P has been aware of Icahn's appetite for high risk invstment, which resulted a loss in 2015. Prior to its loss report, S&P ratings agency questioned Icahn's cashflow status as its $1.175 billion in senior unsecured notes debt is approaching due date in January 2017. The rating agency planned to demote Icahn Enterprises' credit rating to junk status following its loss in commodity sector.
Most of his consecutive losses in two years were inflicted by his bet on oil and commodities companies such as Chesapeake Energy Corporation. His 2015 loss marked the largest loss since his loss in 2008.
Still, Icahn continued to add to his commodities holdings with his $1.3 billion bet on Cheniere Energy last summer, as Forbes reported. Following his takeover on Cheniere Energy, Icahn ousted the company's founder Charif Souki. However, shares of the company are down 57% since his investment.
Icahn also took stakes in Freeport-McMoRan oil and copper producer in July and August last year, which has stumbled close to 50% in the last seven months. His poorly timed investment in either Cheniere Energy and Freeport-McMoRan added up to $1.7 billion loss of investment fund in 2015.
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