Meridian Funds, managed by ArrowMark Partners, released its “Meridian Contrarian Fund” fourth quarter 2023 investor letter. A copy of the same can be downloaded here. Optimism started to prevail, during the last months of the year, and investors reacted positively to news of a potential change in direction by the US Federal Reserve, as well as indications that the US economy is heading for a soft landing. In the fourth quarter, the fund returned 8.80% (net) compared to a 13.3% return for the Russell 2500 Index. Furthermore, the fund underperformed its secondary benchmark, the Russell 2500 Value Index, which returned 13.76% during the same period. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Meridian Contrarian Fund featured stocks like APA Corporation (NASDAQ:APA) in the fourth quarter 2023 investor letter. Headquartered in Houston, Texas, APA Corporation (NASDAQ:APA) engages in oil and natural exploration, development, and production. On April 2, 2024, APA Corporation (NASDAQ:APA) stock closed at $35.34 per share. One-month return of APA Corporation (NASDAQ:APA) was 15.38%, and its shares lost 6.98% of their value over the last 52 weeks. APA Corporation (NASDAQ:APA) has a market capitalization of $10.657 billion.
Meridian Contrarian Fund stated the following regarding APA Corporation (NASDAQ:APA) in its fourth quarter 2023 investor letter:
“APA Corporation (NASDAQ:APA) is a global energy exploration and production company with operations in Egypt, the U.K., the North Sea, the U.S. Permian Basin, and Suriname, where it has made a significant oil discovery and sizeable additional discoveries are expected. We believe APA’s core global production profile is underappreciated and that the business is viewed as defensive, given its low cost to maintain and grow production. APA’s Suriname project, which is moving closer to development with partner TotalEnergies, is expected to provide differentiated low-cost production growth in two to three years as TotalEnergies is carrying the bulk of the development cost. This mix has allowed APA to otherwise aggressively allocate capital to pay down debt and increasingly focus on buying back stock as opposed to financing capital-intensive production growth. During the quarter, the stock declined as the mix of falling oil and gas prices and an announcement from TotalEnergies timed Suriname’s potential first production at the far end of estimates. We increased our holding in APA in the fourth quarter since the timing delay would not change the value we ascribe to the Suriname production. Adding to our confidence was news of the potentially increased size and amount of the first production from that region which, in our view, would more than offset the negative effect of the delay.”
Workers in hard hats and safety gear processing oil and gas in a US refinery.
APA Corporation (NASDAQ:APA) is not on our list of 30 Most Popular Stocks Among Hedge Funds. At the end of the fourth quarter, APA Corporation (NASDAQ:APA) was held by 35 hedge fund portfolios, compared to 34 in the previous quarter, according to our database.
We discussed APA Corporation (NASDAQ:APA) in another article and shared Ariel Focus Fund’s views on the company. In addition, please check out our hedge fund investor letters Q4 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
