Davis Funds, an investment management firm, published its “Davis Opportunity Fund” fourth-quarter 2021 investor letter – a copy of which can be downloaded here. For the year ended December 31, 2021, Davis Opportunity Fund delivered a return of 24.96%, reflecting real progress in the underlying business fundamentals across most of its holdings. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.
Davis Opportunity Fund, in its Q4 2021 investor letter, mentioned Applied Materials, Inc. (NASDAQ:AMAT) and discussed its stance on the firm. Founded in 1967, Applied Materials, Inc. (NASDAQ:AMAT) is a Santa Clara, California-based engineering solutions provider with a $116.5 billion market capitalization, and is currently spearheaded by its CEO, Gary E. Dickerson. Applied Materials, Inc. (NASDAQ:AMAT) delivered a -16.12% return since the beginning of the year, while its 12-month returns are up by 15.50%. The stock closed at $131.99 per share on March 17, 2022.
Here is what Davis Opportunity Fund has to say about Applied Materials, Inc. (NASDAQ:AMAT) in its Q4 2021 investor letter:
“Within technology and communication services, we own a number of online businesses and semiconductor related companies, including Alphabet, Amazon, Intel, Applied Materials and Texas Instruments. Within the realm of high technology, we believe that leadership positions reflect enduring and widening competitive advantages over smaller competitors, with few exceptions. This is because online businesses, as well as semiconductor companies, benefit from economies of scale. An online search and advertising engine will, in general, be more profitable per unit of cost as it grows larger in terms of users and advertising dollars. It is a hub-and-spoke model, in other words, where it is generally not necessary to grow expenses at the same rate that revenues grow beyond a certain threshold. Therefore, returns on capital tend to be higher, the larger and more dominant the online search company is.”
Pixabay/Public Domain
Our calculations show that Applied Materials, Inc. (NASDAQ:AMAT) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. Applied Materials, Inc. (NASDAQ:AMAT) was in 78 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 68 funds in the previous quarter. Applied Materials, Inc. (NASDAQ:AMAT) delivered a -10.03% return in the past 3 months.
In December 2021, we also shared another hedge fund’s views on Applied Materials, Inc. (NASDAQ:AMAT) in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.
Disclosure: None. This article is originally published at Insider Monkey.
