Roubaix Capital was Right in Shorting Hibbett Sports (HIBB), Benefitted From its Downfall

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 Hibbett Sports, Inc. (NASDAQ: HIBB) was one of the top contributors for their short portfolio in the fourth quarter of 2020. Hibbett Sports, Inc. is a premier athletic-inspired fashion retailer company that currently has a $1 billion market cap. For the past 3 months, HIBB delivered a decent 61.34% return and settled at $61.13 per share at the closing of February 12th.

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

“The second best short in the quarter was Hibbett Sports (HIBB), a sporting goods retailer. Many businesses were able to benefit from the spending shifts caused by the pandemic. For example, online retailers, companies that sell into the home improvement markets and grocery stores all saw varying degrees of improvement. We did not see HIBB as a clear beneficiary as they have historically underinvested in their online business. However, they managed to post very strong results during their third quarter from leisure spending trends and the stock reacted favorably. We shorted the strength of this rally and continue hold our position as we do not see HIBB as a longer-term winner in its markets.”

Last December, we published an article telling that Hibbett Sports, Inc. (NASDAQ: HIBB) was in 21 hedge fund portfolios. HIBB delivered an 18.93% return in the past 12 months.

Our calculations show that Hibbett Sports, Inc. (NASDAQ: HIBB) 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.