Ariel Investments, Still Positive with Meredith (MDP)

Ariel Investments, a minority-owned investment company that focuses in small and mid-capitalized US based stocks, published its third-quarter 2020 Investor Letter – a copy of which can be downloaded here. A positive return of 4.56% was recorded by the fund for the 3rd Quarter of 2020, ahead of its Russell 2500 Value benchmark that returned 3.54%. You can view the fund’s top 10 holdings to have a peek at their top bets for 2021.

Ariel Investments in their Q3 2020 Investor Letter said that they were able to distinguish a value in  Meredith Corporation (NYSE: MDP) and even that it underperformed, it is still considered a good position for the hedge fund. Meredith Corporation is a television broadcaster and magazine advertiser that currently has a $899.487 million market cap. For the past 3 months, MDP delivered a huge 63.95% return and settled at $19.74 per share at the closing of January 14th.

Here is what Ariel Investments has to say about BOK Financial Corp. in their Investor Letter:

” Television broadcaster and magazine advertiser, Meredith Corporation (NYSE: MDP) underperformed, as Covid added to the existing challenge of generating cost synergies from the TIME acquisition. The stock was also impacted by being removed from a high dividend yield index. While we acknowledge the challenging fundamentals in its business, local news viewership is up tremendously in the midst of the pandemic and we believe MDP’s profitable local television stations provide a margin of safety1 at today’s valuation level. “

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Last December 2020, we published an article telling that Meredith Corporation (NYSE: MDP) was in 18 hedge funds’ portfolio, almost making it to its all time high statistics of 20. Meredith Corporation still proved its worth by delivering a 2.81% return YTD.