Here’s Why Polen Capital Became Optimistic in Malibu Boats (MBUU)

Polen Capital, an investment management firm, published its “Polen U.S. Small Company Growth” first quarter 2021 investor letter – a copy of which can be downloaded here. A return of 0.99% was delivered by the fund for the first quarter of 2021, trailing its Russell 2000 Growth benchmark that delivered a 4.87% gain for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Polen U.S. Small Company Growth Fund, in its Q1 2021 investor letter, mentioned Malibu Boats, Inc. (NASDAQ: MBUU), and shared their insights on the company. Malibu Boats, Inc. is a Loudon, Tennessee-based recreational boats manufacturer that currently has a $1.6 billion market capitalization. Since the beginning of the year, MBUU delivered a 25.77% return, extending its 12-month gains to 67.09%. As of May 21, 2021, the stock closed at $78.53 per share.

Here is what Polen U.S. Small Company Growth Fund has to say about Malibu Boats, Inc. in its Q1 2021 investor letter:

Malibu Boats was also a top contributor during the quarter. Malibu is the leading designer and manufacturer of powerboats in the U.S. with brands such as Malibu, Axis, Cobalt, and Pursuit.

Additionally, the company is now also a leader in premium saltwater outboard boats following its recent acquisition of Maverick Boat Group, which added brands like Cobia, Pathfinder, and Maverick. Boating demand was strong leading up to the
pandemic, but there was also a marked increase in demand for boats during the pandemic as people found more time for outdoor activities. This has led to a historic backlog for all of Malibu’s brands.

The company is currently meeting this demand with responsible manufacturing that we believe will uphold continued growth in brand strength. For example, the company was able to achieve 5- million-man hours without a single lost-time accident, an unheardof feat despite the pressure of record demand and backlogs. Management attributes this success to their safety-first culture.

Malibu is an example of why we believe a culture that emphasizes all stakeholders can be a competitive advantage.”

Our calculations show that Malibu Boats, Inc. (NASDAQ: MBUU) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the first quarter of 2021, Malibu Boats, Inc. was in 16 hedge fund portfolios. MBUU delivered a -0.44% 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.