Is Hillenbrand (HI) A Smart Long-Term Buy?

Bernzott Capital Advisors, an investment management firm, published its fourth quarter 2020 investor letter – a copy of which can be downloaded here. A return of 24.41% was recorded by the fund in the fourth quarter of 2020, below its  R2000V and R2500V benchmarks that delivered a 33.36% and 28.51% return respectively in the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Bernzott Capital Advisors, in their Q4 2020 investor letter, mentioned Hillenbrand, Inc. (NYSE: HI) and emphasized their views on the company. Hillenbrand, Inc. is a Batesville, Indiana-based global diversified industrial company that currently has a $3.5 billion market capitalization. Since the beginning of the year, HI delivered a 17.89% return, extending its 12-month gains to 161.98%. As of March 23, 2021, the stock closed at $46.92 per share.

Here is what Bernzott Capital Advisors has to say about Hillenbrand, Inc. in their Q4 2020 investor letter:

“Hillenbrand (HI): The stock rose following its 3Q earnings report in which the company demonstrated good margin performance and rising backlog. The company is executing well with its $1.9 billion 2019 acquisition of Milacron, exceeding its first year synergy targets. Strong cash flow enabled a reduction in leverage to 2.7x from 3.8x at the time of the purchase. The company has proven to be a sound capital allocator in M&A over the last decade.”


Our calculations show that Hillenbrand, Inc. (NYSE: HI) 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, Hillenbrand, Inc. was in 13 hedge fund portfolios, compared to 14 funds in the third quarter. HI delivered a decent 20.77% return in the past 3 months.