Mario Gabelli: GenCorp, Legg Mason Will Double

On CNBC Tuesday morning, famed investor Mario Gabelli named two stocks that he believed could double in the near future. Gabelli is the founder of Gabelli Asset Management -- commonly referred to as GAMCO. The two stocks Gabelli named were GenCorp GY and Legg Mason LM. GenCorp is an aerospace and defense manufacturing company, but it also has significant real estate holdings. Gabelli seemed to suggest that he liked the company primarily for its “significant acreage” in Sacramento given that the real estate market was “booming.” Gabelli's second pick was Legg Mason LM. Yesterday, GAMCO increased its stake in Legg Mason, upping it to 5.13% from 4.05%. Gabelli's argument for Legg Mason was based on the company's buyback program. Gabelli noted that the company has announced that ⅔ of its cash flow was going to buy back stock, and that the company was a great cash generator. Shares of GenCorp traded up over 6% on Tuesday, likely on Gabelli's comments. With a market cap under $1 billion, it wouldn't be hard for someone like Gabelli to push around shares of a company like GenCorp. Legg Mason shares, on the other hand, were only up about 1.5%. The company's market cap is more than three times greater than GenCorp's. Shares of GenCorp traded near $11.45 early Tuesday, while Legg Mason shares were near $28.