Is Raven Industries (RAVN) A Smart Long-Term Buy?

Roubaix Capital LLC, an investment management firm, published its ‘Roubaix Fund Composite’ fourth-quarter 2020 Investor Letter – a copy of which can be downloaded here. A net return of 26.63% was recorded by the fund for the Q4 of 2020, outperforming its HFRI Equity Hedge benchmark that delivered a 14.50% return but below its Russell 2000 index that had a 31.37% return. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Roubaix Capital, in their Q4 2020 Investor Letter, said that they see good opportunities in Raven Industries, Inc. (NASDAQ: RAVN). Raven Industries, Inc. is an agriculture products manufacturing company that currently has a $1.3 billion market cap. For the past 3 months, RAVN delivered a decent 57.68% return and settled at $37.86 per share at the closing of February 16th.

Here is what Roubaix Capital has to say about Raven Industries, Inc. in their Q4 2020 investor letter:

“While we see the unleashing of pent up consumer demand driving certain businesses in 2021, we also see good opportunities in the industrial complex where is potential to find companies with a combination of cyclical, thematic and company specific drivers. One example is Raven Industries (RAVN), an agriculture equipment company that has invested heavily in automation, a consistent theme in our long portfolio. With the economy recovering and corn prices rising recently, the cyclical outlook has also improved. In the medium and long run, using technology to improve productivity is critically important. RAVN’s products allow equipment to be run around the clock with fewer employees. We see RAVN compounding value both in 2021 and in the years ahead.”

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Last December, we published an article telling that Raven Industries, Inc. (NASDAQ: RAVN) was in 16 hedge fund portfolios, its all time high statistics. RAVN delivered a 23.22% return in the past 12 months.

Our calculations show that Raven Industries, Inc. (NASDAQ: RAVN) does not belong in our list of 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.