Blue Hawk Investment on Lyft Inc. (LYFT): ‘We Prefer Lyft Over Uber’

Blue Hawk Investment Group, an investment management firm, published its fourth-quarter 2020 Investor Letter – a copy of which can be downloaded here. A return of 7.48% was recorded by the fund for the Q4 of 2020, below its S&P 500 benchmark that delivered an 11.69% return. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Blue Hawk Investment Group in their Q4 2020 Investor Letter said that they established a meaningful position in Lyft, Inc. (NASDAQ: LYFT) in the 4th quarter of 2020. Lyft, Inc. is a ride sharing company that currently has a $16.9 billion market cap. For the past 3 months, LYFT delivered a decent 48.16% return and settled at $53.41 per share at the closing of February 8th.

Here is what Blue Hawk Investment Group has to say about Lyft, Inc. in their Q4 2020 investor letter:

” We purchased a meaningful position in LYFT in the quarter, accumulating the position beginning in the low $40s. A tactical position that we are hopeful can evolve into an investment, Lyft is a ride-sharing company operating primarily in the US. A massive TAM in a duopolistic industry structure, we are betting changes in industry structure, driven by new legislation and pandemic driven cost cutting, have removed the bear case for the stock. We prefer Lyft over Uber as we believe Lyft is more of a recovery pure-play and we think the strategic value of the Lyft asset provides a floor and enhances the risk/return of the investment. Lyft trades roughly at parity to the S&P 500 on a normalized EV/Revenue basis despite a greater than 5x top-line growth profile and a superior profitability profile at maturity. We believe the stock is significantly undervalued.”

Last December, we published an article telling that Lyft, Inc. (NASDAQ: LYFT) was in 32 hedge fund portfolios. Its all time high statistics is 71. LYFT delivered an 8.71% return YTD.

Our calculations show that Lyft, Inc. (NASDAQ: LYFT) does not belong in our list of the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 216% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 121 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

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Disclosure: None. This article is originally published at Insider Monkey.