Weitz Investment Management, an investment management firm, published its “Value Fund” first quarter 2021 investor letter – a copy of which can be downloaded here. A return of +7.42% was recorded by the fund for the first quarter of 2021, outperforming its S&P 500 benchmark that delivered a +6.17% return, and the Morningstar Large-Cap Blend category that gained +6.24% for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.
Weitz Investment Management, in its Q1 2021 investor letter, mentioned Diageo plc (NYSE: DEO), and shared their insights on the company. Diageo plc is a London, United Kingdom-based beverage company that currently has a $111.6 billion market capitalization. Since the beginning of the year, DEO delivered a 20.29% return, extending its 12-month gains to 37.76%. As of May 21, 2021, the stock closed at $191.03 per share.
Here is what Weitz Investment Management has to say about Diageo plc in its Q1 2021 investor letter:
“We sold Diageo after twelve years of very profitable ownership. The global spirits company has done a fine job of growing earnings, and the stock has enjoyed an extra boost from substantial, multiple expansions along the way. While the business is in good hands, we think a repeat of our mid-double-digit annualized return experience is far less likely. We simply see better risk/reward profiles in the Fund’s other quality holdings.”
Our calculations show that Diageo plc (NYSE: DEO) 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, Diageo plc was in 22 hedge fund portfolios, compared to 23 funds in the fourth quarter of 2020. DEO delivered a 14.11% 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.
At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best innovative stocks to buy to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website:
Disclosure: None. This article is originally published at Insider Monkey.