Polen Capital Management recently released its Q3 2020 Investor Letter, a copy of which you can download here. During the third quarter of 2020, the Polen U.S. Small Company Growth Composite Portfolio returned 4.57% gross of fees, while the Russell 2000 Growth Index was up 7.17%. You should check out Polen Capital’s top 5 stock picks for investors to buy right now, which could be the biggest winners of this year.
In the said letter, Polen Capital highlighted a few stocks and LeMaitre Vascular Inc (NASDAQ:LMAT) is one of them. LeMaitre Vascular Inc (NASDAQ:LMAT) is a provider of medical devices for the treatment of peripheral vascular disease. Year-to-date, LeMaitre Vascular Inc (NASDAQ:LMAT) stock gained 6.2% and on November 13th it had a closing price of $38.18. Here is what Polen Capital said:
“Finally, we liquidated our position in LeMaitre Vascular, a holding for more than two years, after observing management behaviors that we believe conflict with our flywheel. The company has a business model selling products used in vascular surgeries that is highly repeatable, and it has shown strong profitability metrics for some time. We have always known management to act in the best long-term interests of the business and in alignment with the values of all stakeholders.
During the early stages of the crisis, we were concerned to see management immediately and dramatically reduce headcount to maintain profitability despite having cash on the balance sheet. It also chose to maintain the dividend the company pays out to shareholders, including its CEO who is the company’s largest shareholder. We decided that cutting a significant portion of the workforce while keeping the CEO’s dividend is not beneficial to the culture of the organization, nor is it in the best long-term interests of the business. As we have said on many occasions, we think the actions of leadership during a crisis like COVID-19 reveal how dedicated management teams are towards their strategy of long-term value creation. These short-term behaviors are a red flag for us.”
In Q1 2020, the number of bullish hedge fund positions on LeMaitre Vascular Inc (NASDAQ:LMAT) stock decreased by about 33% from the previous quarter (see the chart here), so a number of other hedge fund managers don’t believe in LeMaitre Vascular’s growth potential. Our calculations showed that LeMaitre Vascular Inc (NASDAQ:LMAT) 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
At Insider Monkey we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 10 most profitable companies in the world to pick the best large-cap stocks to buy. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website:
Disclosure: None. This article is originally published at Insider Monkey.