Here’s Why Artisan Mid Cap Sold their L3Harris (LHX) Position

Artisan Partners Limited Partnership, a high value-added investment management firm, published its ‘Artisan Mid Cap Fund’ fourth quarter 2020 investor letter – a copy of which can be downloaded here. A return of 16.82% was recorded by its Investor Class: ARTMX, 16.87% by its Advisor Class: APDMX, and 16.89% by its Institutional Class: APHMX, in the fourth quarter of 2020, all below its Russell Midcap Growth Benchmark that delivered a 19.02% return and its Russel Midcap Index that was up by 19.91% in the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Artisan Mid Cap Fund, in their Q4 2020 investor letter, mentioned L3Harris Technologies, Inc. (NYSE: LHX) and emphasized their views on the company. L3Harris Technologies, Inc. is a Florida-based defense technology company that currently has a $39.5 billion market capitalization. Since the beginning of the year, LHX delivered a 1.60% return, extending its 12-month gains to 14.32%. As of March 17, 2021, the stock closed at $192.04 per share.

Here is what Artisan Mid Cap Fund has to say about L3Harris Technologies, Inc. in their Q4 2020 investor letter:

“We also exited our position in L3Harris Technologies. L3Harris’ recent quarterly results showed some pandemic-related impact on the company’s business, though relative to other industrials stocks, the effect has been quite modest, and it is achieving ahead-of-schedule synergies from its recent merger. However, concerns about ballooning federal deficits and potential associated defense-budget cuts have been a headwind. We share these concerns, and with the company’s market cap above the mid-cap range, we concluded our campaign to fund newer profit cycle opportunities.”

Michael Fitzsimmons/

Our calculations show that L3Harris Technologies, Inc. (NYSE: LHX) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, L3Harris Technologies, Inc. was in 37 hedge fund portfolios, compared to 42 funds in the third quarter. LHX delivered a 3.18% return in the past 3 months.

The top 10 stocks among hedge funds returned 231.2% between 2015 and 2020, and outperformed the S&P 500 Index ETFs by more than 126 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. Here you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

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