Home Depot (HD), A Notable Detractor for Ensemble Capital’s Performance

Ensemble Capital Management, an investment management firm, published its fourth-quarter 2020 Investor Letter – a copy of which can be downloaded here. In the letter, they discussed the whole year performance of the fund in 2020 and also gave insights on the investment decisions they’ve made last year. You can view the fund’s top 10 holdings to have a peek at their top bets for 2021.

Ensemble Capital Management, in their Q4 2020 Investor Letter said that they consider The Home Depot, Inc. (NYSE: HD) as one of the detractors from their performance. The Home Depot, Inc. is a home improvement retailer company that currently has a $291.5 billion market cap. For the past 3 months, HD delivered a 1.54% return and settled at $270.82 per share at the closing of January 29th.

Here is what Ensemble Capital Management has to say about The Home Depot, Inc. in their investor letter:

“A notable detractor from our performance came from our investment in Home Depot. Home Depot reported outstanding results during 2020, with the stock outperforming the S&P 500 for the full year. But after strong second and third quarter performance, the stock was down slightly in the fourth quarter, declining approximately 4%. We believe that home improvement spending will remain elevated in the years ahead as housing activity continues to rebound after years of lower than normal rates of Americans moving.”

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Last November 2020, we published an article telling that The Home Depot, Inc. (NYSE: HD) was in 73 hedge fund portfolios. Its all time high statistics is 91. HD delivered a decent 18.73% return in the past 12 months.

Our calculations show that The Home Depot, Inc. (NYSE: HD) does not belong in our list of the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 216% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 121 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. Below you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

Video: Top 5 Stocks Among Hedge Funds

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