INVESTMENT SCORECARD
Media companies rebounded strongly in the first quarter as several video streaming services introduced new packages and curtailed costs. Warner Bros. Discovery (1.3% of net assets as of March 31, 2023, +59%), the product of Discovery’s 2022 acquisition of Warner Bros. from AT&T and Paramount Global (5.6%, +33%), the product of the 2019 combination of Viacom and CBS, were two beneficiaries of this dynamic. Sony (7.1%, +19%) rose along with a better outlook for video games and a turn in the semiconductor cycle. Financial engineering supported the Fund as Crane (3.4%, +13%) and MSG Entertainment (2.3%, +31%) each split into two companies in April. A mild winter and rising interest rates weighed on most gas utilities, including National Fuel Gas (3.5%, -8%). Sagging energy prices also hurt oilfield services provider Halliburton (1.0%, -19%), though post-quarter oil production cuts firmed prices. Finally, heavily indebted DISH Network (0.7%, -34%) was forced to balance its wireless network buildout with a crippling cyberattack during the quarter.
COMPARATIVE RESULTS
Average Annual Returns through March 31, 2023 (a)
Total returns and average annual returns reflect changes in share price, reinvestment of distributions, and are net of expenses.
Performance returns for periods of less than one year are not annualized.
| Gabelli Value 25 Fund Inc. | QTR | 1 Year | 5 Year | 10 Year | 15 Year | Since Inception | |
| (09/29/89) | |||||||
| Class I (GVCIX) (b) | 6.25% | (8.83)% | 4.07% | 5.31% | 6.53% | 9.26% | |
| S&P 500 Index (c) | 7.50 | (7.73) | 11.19 | 12.24 | 10.06 | 9.90 |
LET’S TALK STOCKS
American Express Co. (AXP, Financial) (5.4% of net assets as of March 31, 2023) (AXP – $164.95 – NYSE) is the largest closed loop credit card company in the world. The company operates its eponymous premiere branded payment network and lends to its largely affluent customer base. As of December 2022, American Express has 133 million cards in force and nearly $110 billion in loans. The company’s strong consumer brand has allowed American Express to enter the deposit gathering market as an alternate source of funding, while the company’s affluent customers have picked up spending. Longer term, American Express should capitalize on its higher-spending customer base, especially with millennials, and continue to expand into other payment related businesses, such as corporate purchasing, while also growing in emerging markets. Similarly, the company is looking at the growing success of social media as an opportunity to expand its product base and payment options.
Crane Holdings Co. (CR, Financial) (3.4%) (CR – $113.50 – NYSE), based in Stamford, Connecticut, is a diversified manufacturer of highly engineered industrial products comprised of four business segments: Aerospace & Electronics, Process Flow Technologies, Payments & Merchandising Technologies, and Engineered Materials, with over 11,000 employees across 34 countries. The company announced in March 2022 it would separate into two independent companies, where the Payment and Merchandising Technologies business will become “Crane NXT” and the Aerospace & Electronics and Process Flow Technologies business will retain the Crane Co. name.
Newmont Corp. (NEM, Financial) (5.7%) (NEM – $49.02 – NYSE) is the largest gold mining company in the world by volume, expected to produce approximately 6 million ounces in 2023. Newmont aims to maintain production through internal expansion projects as some mines deplete. This capital-light model will allow the company to pay increasingly larger dividends if the price of gold stays at current levels or appreciates.
Sony Corp. Group (SONY, Financial) (7.1%) (SONY – $90.65 – NYSE) is a global conglomerate based in Tokyo, Japan, focusing on direct-to-consumer entertainment products. Sony is the #1 integrated global gaming company with its Sony PlayStation 5 gaming platform and video game development studios. Sony Music Recording commands #2 and Music Publishing #1 global share. Sony Music is capitalizing the growth of streaming. Sony also operates the Sony/Columbia film studio, which is well positioned in the OTT streaming wars as a major supplier of high quality library shows. Sony is an image sensor leader, and its expanding its growth opportunity from the high-end Apple iPhones to automotive image sensors. Sony’s Electronics business remains a globally diversified and defensive cash generator.
Returns represent past performance and do not guarantee future results. Investment returns and the principal value of an investment will fluctuate. When shares are redeemed, they may be worth more or less than their original cost. Current performance may be lower or higher than the performance data presented. Visit www.gabelli.com for performance information as of the most recent month end.
