Al Root

Carl Icahn has snapped up shares of a U.S. fertilizer producer almost every day since the Nov. 5 presidential election.

Filings with the Securities and Exchange Commission show that Icahn has purchased CVR Partners stock every day since the election. That's 15 consecutive trading sessions and counting.

He's bought about 142,000 shares over that span, bringing his total to about 3.9 million. Icahn holds about 37% of the stock outstanding.

Clearly, he liked CVR's business before the election. Now he appears to like it a little more. Icahn representatives didn't immediately respond to a request for comment, but his purchases appear to be a bet on the outlook for natural gas under a second term for President-elect Donald Trump.

CVR Partners manufactures ammonia-based fertilizers at plants in Kansas and Illinois. (Its stock trades under the symbol UAN, which references urea ammonium nitrate, a common fertilizer.) The Illinois facility uses natural gas as a raw material, and gas is the biggest input cost in making ammonia-based fertilizers.

Costs are set to go down as supply increases under Trump's " energy dominance" agenda, which includes plans for more oil and gas drilling, potentially lowering prices with increased supply.

There are other examples of increased optimism related to falling natural gas costs. Wall Street price targets for shares of GE Vernova are up about $27 to an average of $334, according to FactSet. GE Vernova makes natural gas-fired power-generation turbines. On Monday, RBC analyst Christopher Dendrinos took his GE Vernova price target to $376 a share from $285 noting that the supply-and-demand balance for the turbines is tight, which allows GE Vernova to raise prices.

Dendrinos rates GE Vernova shares Buy. Overall, 74% of analysts covering the stock rate shares Buy. The average Buy-rating ratio for shares in the S&P 500 is about 55%.

No analysts cover CVR Partners, according to FactSet. It's a relatively small company with a market value of about $750 million. Shares currently yield about 9.4%.

Through midday trading Wednesday, CVR Partners shares are up about 7% since the election. GE Vernova stock has added about 5%. The S&P 500 is up about 4% over the same span.

Write to Al Root at allen.root@dowjones.com

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November 27, 2024 12:15 ET (17:15 GMT)

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