Is Graham Holdings (GHC) a Smart Long-term Buy?

Longleaf Partners Small-Cap Fund, a Memphis-based fund under Southeastern Asset Management, recently released its Q3 2020 Investor Letter, a copy of which you can download here. The fund posted a return of 22.2% for the quarter, outperforming its benchmark, the Russell 2000 Index which returned 4.93% in the same quarter. You should check out Longleaf Partners’ top 5 stock picks for investors to buy right now, which could be the biggest winners of 2021.

In the Q3 2020 Investor Letter, Longleaf Partners highlighted a few stocks and Graham Holdings Co (NYSE:GHC) is one of them. Graham Holdings Co (NYSE:GHC) operates as a diversified education and media company worldwide. Year-to-date, Graham Holdings Co (NYSE:GHC) stock lost 22.4% and on December 22nd it had a closing price of $496.02. Here is what Longleaf Partners said:

“Graham Holdings (18%, 0.94%), the media, education and manufacturing conglomerate also contributed to positive returns. With small businesses slashing marketing expenses, Graham’s quarterly TV revenues fell 17% excluding the electionyear growth in political advertising. However, the TV revenues bottomed in April and have since shown marked improvement. In Education, Kaplan International constantcurrency revenues decreased 9% due to the freeze in international travel and campus closures, but this result was better than feared and the segment’s margins held up well. Kaplan Higher Education, a joint venture with Purdue, grew strongly, as did the company’s wood treating and podcasting subsidiaries. CEO Tim O’Shaughnessy took advantage of a highly discounted price by repurchasing at a 7% annualized pace and announced in September the board’s new repurchase authorization of up to 500,000 shares.”


In Q2 2020, the number of bullish hedge fund positions on Graham Holdings Co (NYSE:GHC) stock increased by about 5% from the previous quarter (see the chart here), so a number of other hedge fund managers believe in Graham’s growth potential. Our calculations showed that Graham Holdings Co (NYSE:GHC) isn’t ranked among 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.