Is Wingstop (WING) A Smart Long-Term Buy?

Artisan Partners, a high value-added investment management firm, published its ‘Artisan Small Cap Fund’ first quarter 2021 investor letter – a copy of which can be downloaded here. A return of -5.02% was recorded by its Investor Class: ARTSX, -4.99% by its Advisor Class: APDSX, and -4.95% by its Institutional Class: APHSX for the fourth quarter of 2020, all below the Russell 2000® Growth Index that delivered a 4.88% return and the Russell 2000® Index that was up by 12.70% for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Artisan Small Cap Fund, in its Q1 2021 investor letter, mentioned Wingstop Inc. (NASDAQ: WING), and shared their insights on the company. Wingstop Inc. is a Dallas, Texas-based restaurant company that currently has a $3.9 billion market capitalization. Since the beginning of the year, WING delivered a 0.97% return, while its 12-month gains are up by 9.12%. As of May 18, 2021, the stock closed at $133.83 per share.

Here is what Artisan Small Cap Fund has to say about Wingstop Inc. in its Q1 2021 investor letter:

Wingstop is in the early stages of growing its store footprint of quick-service restaurants both domestically and internationally. We believe this is supported by attractive economics for franchisees (35%-40% cash-on-cash returns in year two), growing brand awareness in new and existing markets and a well-established digital channel—as much as ~75% of order volume has been takeout during the pandemic. We capitalized on recent weakness to add to our position.”

Chicken, fast food


Our calculations show that Wingstop Inc. (NASDAQ: WING) 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, Wingstop Inc. was in 28 hedge fund portfolios, compared to 32 funds in the third quarter. WING delivered a -7.09% 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.