Is Corteva (CTVA) A Good Investment Choice?

Rhizome Partners, an investment management firm, published its first quarter 2021 investor letter – a copy of which can be downloaded here. A return of 11.5% was recorded by the fund, outperforming the S&P 500 Index that delivered a +6.2% return and the FTSE NAREIT All Equity REIT Total Return Index that was up by 8.3% for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Rhizome Partners, in its Q1 2021 investor letter, mentioned Corteva, Inc. (NYSE: CTVA), and shared their insights on the company. Corteva, Inc. is a Wilmington, Delaware-based agricultural chemical company that currently has a $33 billion market capitalization. Since the beginning of the year, CTVA delivered a 15.81% return, extending its 12-month gains to 78.72%. As of May 18, 2021, the stock closed at $45.78 per share.

Here is what Rhizome Partners has to say about Corteva, Inc. in its Q1 2021 investor letter:

“We are still getting used to the higher multiples that investors will pay for larger market cap and pure play companies such as Corteva. We do understand the market’s rationale. For example, Corteva operates in a duopoly with Monsanto, owned by Bayer AG, that provides genetically modified seeds and pesticides. With some operating leverage, the company can probably grow FCF at 4-6% a year. This brings the total return close to the long-term return of the S&P 500 index of 10%. Through trial and error, we have come to appreciate how scale, higher market share, route densities, switching costs, and collaborative relationships amongst major industry players can contribute to sustained high returns on invested capital.”

Marcin Balcerzak/

Our calculations show that Corteva, Inc. (NYSE: CTVA) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, Corteva, Inc. was in 38 hedge fund portfolios, compared to 36 funds in the third quarter. CTVA delivered a -0.08% 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.