Ariel Investments, an investment management firm, published its “Ariel Fund & Ariel Appreciation Fund” third-quarter 2021 investor letter – a copy of which can be downloaded here. A return of -0.17% was recorded by the Fund for the third quarter of 2021, compared to the Russell 2500TM Value Index, Russell 2500TM Index, and S&P 500® Index which had a -2.07%, -2.68%, and 0.58% returns respectively for the same period. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.
Ariel Fund & Ariel Appreciation Fund, in its Q3 2021 investor letter, mentioned Stericycle, Inc. (NASDAQ: SRCL) and discussed its stance on the firm. Stericycle, Inc. is a Bannockburn, Illinois-based compliance company with a $5.4 billion market capitalization. SRCL delivered a -15.19% return since the beginning of the year, while its 12-month returns are down by -15.78%. The stock closed at $58.80 per share on December 15, 2021.
Here is what Ariel Fund & Ariel Appreciation Fund has to say about Stericycle, Inc. in its Q3 2021 investor letter:
“Waste management services provider Stericycle, Inc. (SRCL) also weighed on relative returns over the trailing one-year period. Importantly, the core waste collection and disposal business continues to show signs of stability, as waste volume associated with vaccine administration and COVID-19 testing continues to help offset declines in elective surgical procedures and maritime waste services. Looking ahead, we continue to believe SRCL is a solid franchise with stable long-term growth prospects, favorable margin expansion and strong free cash flow generation opportunities.
The COVID-19 Delta variant, supply chain shortages, looming political battles over infrastructure spending, the debt ceiling and potential changes in tax rates present risks on a go-forward basis. However, we remain cautiously optimistic the post-lockdown recovery will continue, albeit at a slower pace, due to improving consumer confidence, positive corporate earnings growth expectations, and
accelerating vaccination rates. We believe high valuations, rising inflation, and less accommodative monetary policy should be top of mind for investors. The best offense is often a good defense. Ignoring market noise and searching instead for quality companies with dominant franchises, capable management teams and robust balance sheets should help insulate on the downside. Given our “slow and steady” investment approach, confidence in our current positioning remains high. As we head into a new fiscal year, we firmly believe the dedicated patient investor that stays the course and consistently owns differentiated businesses at reasonable prices will deliver strong returns over the long run.Equity markets delivered a remarkable recovery over the trailing one-year period. Record levels of fiscal support, ultra-low interest rates, accelerating vaccination rates and pent-up consumer demand helped drive strong corporate earnings growth. All has not been goldilocks, however, as the markets upward trajectory was interrupted over the summer by rising cases of the COVID-19 Delta variant, continued supply chain constraints and persistently high inflation. While we expect volatility to remain elevated, we believe investors focused on underlying long-term business fundamentals will likely be rewarded. Against this backdrop, Ariel Appreciation Fund advanced +45.27% over the trailing one-year period, outperforming both the Russell Midcap Value Index and the Russell Midcap Index returns of +42.40% and +38.11%, respectively.”
Based on our calculations, Stericycle, Inc. (NASDAQ: SRCL) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. SRCL was in 17 hedge fund portfolios at the end of the third quarter of 2021, compared to 26 funds in the previous quarter. Stericycle, Inc. (NASDAQ: SRCL) delivered a -14.81% return in the past 3 months.
Earlier this year, we also shared another hedge fund’s views on SRCL in another article. You can find more than 100 investor letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q3 page.
Disclosure: None. This article is originally published at Insider Monkey.
