Artko Capital recently released its Q2 2020 Investor Letter, a copy of which you can download here. The fund posted a return of -11.4% for the quarter, underperforming its benchmark, the S&P 500 Index which returned 20.5% in the same quarter. You should check out Artko Capital’s 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, Artko Capital highlighted a few stocks and Viad Corp (NYSE:VVI) is one of them. Viad Corp (NYSE:VVI) engages in the provision of marketing services and travel and recreation services. Year-to-date, Viad Corp (NYSE:VVI) stock lost 74.8% and on August 6th it had a closing price of $17.01. Here is what Artko Capital said:
“Viad (VVI) – In the first half of 2020, in what is likely the biggest disappointment of our partnership’s five year history, we sold our entire holding in Viad, which declined over 70% from its 2019 year end, at prices between $17 and $20, as the company’s two core businesses, global event and conference management and hotels and attractions faced, what we consider, an insurmountable road back in a post-Covid world. As we have written previously we are allergic to debt and most of the time have an expectation of a value unlocking event for an investment to qualify for inclusion in our Core Portfolio. Viad was well on its way to spinning off or selling its hereto valuable Pursuit, hotel and public attractions, business; while marginally adding to its debt levels via accretive tuck in acquisitions. However, the Coronavirus and economic events of 2020 left both of their business segments, which rely on close human interaction, in taters, likely to earn very little revenue this year and setting its earning power back a half a decade. In the meantime, the company continues to burn $10s of millions of cash, adding to their sudden dangerously high debt levels, requiring continuous covenant waivers from their lenders. A combination of leverage, a semi-permanent decline in earning power and the likely disappearance of a near term value unlocking event made holding our investment in Viad, as a Core Portfolio holding, an untenable proposition. We will keep a close eye on this company and we will be cheering for the company’s recovery from the sidelines and may potentially take a flier as a small position for our Enhanced Portfolio down the line.”
In Q1 2020, the number of bullish hedge fund positions on Viad Corp (NYSE:VVI) stock remained unchanged from the previous quarter (see the chart here). Our calculations showed that Viad Corp (NYSE:VVI) 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
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Disclosure: None. This article is originally published at Insider Monkey.