Here’s What Makes CNH Industrial N.V. (CNHI) A Great Investment Choice

ClearBridge Investments, an investment management firm, published its “Value Equity Strategy” third quarter 2021 investor letter – a copy of which can be downloaded here. The ClearBridge Value Equity Strategy had a negative absolute return for the third quarter and underperformed the benchmark Russell 1000 Value Index. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

ClearBridge Investments Value Equity Strategy, in its Q3 2021 investor letter, mentioned CNH Industrial N.V. (NYSE: CNHI) and discussed its stance on the firm. CNH Industrial N.V.  is an Amsterdam, Netherlands-based agricultural machinery company with a $25.5 billion market capitalization. CNHI delivered a 47.12% return since the beginning of the year, while its 12-month returns are up by 48.16%. The stock closed at $18.89 per share on December 24, 2021.

Here is what ClearBridge Investments Value Equity Strategy has to say about CNH Industrial N.V.  in its Q3 2021 investor letter:

“Despite the lower turnover, we still invested in three new names during the quarter where we think price is attractively below our assessment of value: CNH Industrial. CNH Industrial is the number two farm equipment producer globally after Deere. Led by a new CEO with a proven track record, the company is facing a major rerating event early next year in its planned spin-off of its commercial truck business. The remaining pure play agriculture business will boast higher margins, higher returns on capital, lower capital intensity and stronger free cash flow generation, with strong near-term growth prospects driven by the start of a new agriculture cycle and longterm outlook driven by opportunities in precision farming. At less than 6x EV/EBITDA, the value of CNH Industrial is more than justified by its agriculture business alone, with investors getting all other parts of the company for free.”

Photo by Sebastian Gómez on Unsplash

Based on our calculations, CNH Industrial N.V. (NYSE: CNHI) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. CNHI was in 25 hedge fund portfolios at the end of the third quarter of 2021, compared to 24 funds in the previous quarter. CNH Industrial N.V. (NYSE: CNHI) delivered a 9.63% return in the past 3 months.

In November this year, we also shared another hedge fund’s views on CNHI in another article. You can find more than 100 investor letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q3 page.

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