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If You Own FleetCor Technologies (FLT) Stock, Should You Sell It Now?

On July 14, 2020, Wedgewood Partners released its Q2 2020 Investor Letter, a copy of which you can download here. The Fund returned 27.13% for the second quarter of 2020. Meanwhile, the benchmark Russell 1000 Growth Index and the Russell 1000 Value Index gained 27.84% and 14.29%, respectively. You should check out Wedgewood Partners’ top 5 stock picks for investors to buy right now, which could be the biggest winners of the stock market crash.

In the said letter, Wedgewood Partners highlighted a few stocks and FleetCor Technologies Inc (NYSE:FLT) is one of them. FleetCor Technologies Inc (NYSE:FLT) provides fuel cards and workforce payment products and services. Year-to-date, FleetCor Technologies Inc (NYSE:FLT) stock lost 14.1% and on July 13th it had a closing price of $248.30. Here is what Wedgewood Partners said:

“During the quarter we sold Fleetcor and rolled the proceeds into Bristol-Myers Squibb. We initiated Fleetcor two quarters ago at a very small weighting, as our payment industry exposure already included overweights in Visa and PayPal. While Fleetcor has a few attractive assets in the electronic payments space, particularly in corporate payments and tolls, we think the majority of the Company’s assets will be pressured in the new macroenvironment. In contrast, we believe both Visa and PayPal possess significant value propositions that should benefit long-term from the social, cultural and economic changes brought on by the pandemic. As such, we would prefer to add to Visa and PayPal on potential future weakness and sold Fleetcor in order to make room relative to our self-imposed 15% industry maximum weighting. We used the proceeds to add to Bristol-Myers, which was one of our smallest weightings. Bristol-Myers Squibb is less macro-sensitive, has an attractive pipeline due to its recently closed acquisition of Celgene, and a historically depressed multiple despite purchasing Celgene at a single-digit earnings multiple.”

In Q1 2020, the number of bullish hedge fund positions on FleetCor Technologies Inc (NYSE:FLT) stock increased by about 16% from the previous quarter (see the chart here), so a number of other hedge fund managers don’t seem to agree with FleetCor’s downside potential. Our calculations showed that FleetCor Technologies Inc (NYSE:FLT) isn’t ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 185% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 109 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

At Insider Monkey we scour multiple sources to uncover the next great investment idea. There is a lot of volatility in the markets and this presents amazing investment opportunities from time to time. For example, this trader claims to deliver juiced up returns with one trade a week, so we are checking out his highest conviction idea. A second trader claims to score lucrative profits by utilizing a “weekend trading strategy”, so we look into his strategy’s picks. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We recently recommended several stocks partly inspired by legendary Bill Miller’s investor letter. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February after realizing the coronavirus pandemic’s significance before most investors. You can subscribe to our free enewsletter below to receive our stories in your inbox:

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