If you are looking for the best ideas for your portfolio you may want to consider some of Miller Value Partners top stock picks. Miller Value Partners, an investment management firm, is bullish on Maxar Technologies Inc. (NYSE:MAXR) stock. In its Deep Value Strategies Q2 2019 investor letter – you can download a copy here – the firm discussed its investment thesis on Maxar Technologies Inc. (NYSE:MAXR) stock. Maxar Technologies Inc. (NYSE:MAXR) is a space technology company.
On July 23, 2019, Miller Value Partners had released its Deep Value Strategies Q2 2019 investor letter. The investment firm said that Maxar Technologies Inc. (NYSE:MAXR) was one of the top holdings in Q2 2019. Maxar Technologies Inc. (NYSE:MAXR) stock has posted a return of 235.1% in the trailing one year period, outperforming the S&P 500 Index which returned 15.1% in the same period. This suggests that the investment firm was right in its decision. On a year-to-date basis, Maxar Technologies Inc. (NYSE:MAXR) stock has risen by 51.0%.
Let’s take a look at comments made by Miller Value Partners about Maxar Technologies Inc. (NYSE:MAXR) stock in the Q2 2019 investor letter.
“Maxar Technologies became a new investment earlier this year and has recently become one of our top holdings. The company is a global leader of advanced space technology solutions (geospatial data and analytics, satellites, space robotics, space infrastructure, and defense systems) to U.S. and International governments and commercials customers (e.g., Echostar, Uber, Boeing, Lockheed Martin). Maxar suffered a series of setbacks after acquiring Digitalglobe in 2017, causing their stock price to fall over 90% from its highs in 2018. With a new CEO taking the helm earlier this year, we believe the company is aggressively focused on the right initiatives to improve future results. Some key items are right-sizing their satellite manufacturing cost structure which remains at a cyclical order low, enhancing their balance sheet, and reducing the capital intensity of Maxar’s business model. We think the company provides critical products and services to government agencies and commercial clients and has a significant asset base that is being overlooked by the marketplace that is focused on historical challenges. Over the next couple of years, we believe management will be successful in scaling their assets with reoccurring revenue streams which should drive ROIC improvement and significant free cash flow generation. As the company reduces debt by selling non-core assets and future free cash flow, we believe there is a significant opportunity to unlock the equity value and narrow the steep discount to their intrinsic value. During the second quarter, the stock appreciated more than 90% from its recent lows as management accelerated action steps and won incremental long-term contracts. While the turnaround will continue to unfold over the coming year, which could lead to volatility in their operating results, we continue to see their fundamental value significantly higher than the current share price.”
In Q1 2020, the number of bullish hedge fund positions on Maxar Technologies Inc. (NYSE:MAXR) stock increased by about 23% from the previous quarter (see the chart here), so a number of other hedge fund managers seem to agree with Maxar Technologies’ growth potential. Our calculations showed that Maxar Technologies Inc. (NYSE:MAXR) isn’t ranked among the 30 most popular stocks among hedge funds.
The top 10 stocks among hedge funds returned 185% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 109 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.