Wasatch Global Investors, an investment management firm, published its “Wasatch Micro Cap Value Fund” first quarter 2021 investor letter – a copy of which can be downloaded here. A return of 14.74% was recorded by the fund’s investor class for the Q1 of 2021, trailing the benchmark, Russell Microcap® Index, which leapt 23.89% for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.
Wasatch Micro Cap Value Fund, in its Q1 2021 investor letter, mentioned Sterling Construction Company, Inc. (NASDAQ: STRL), and shared their insights on the company. Sterling Construction Company, Inc. is a Houston, Texas-based construction company company that currently has a $649.3 million market capitalization. Since the beginning of the year, STRL delivered a 21.98% return, extending its 12-month gains to 176.66%. As of May 10, 2021, the stock closed at $22.70 per share.
Here is what Wasatch Micro Cap Value Fund has to say about Sterling Construction Company, Inc. in its Q1 2021 investor letter:
“The first is Sterling Construction Co., Inc. (STRL), which specializes in higher-margin work on highways, bridges, airports, water and sewer facilities, light-rail projects, flat concrete for subdivisions and foundations for data centers. For companies such as Sterling, we like to look at a metric known as EV (enterprise value) to EBITDA. Sterling’s EV to EBITDA ratio is about 7, which we think is inexpensive compared to competitors. Moreover, we believe the stock could benefit not only from increased construction business but also from investors’ willingness to accept a much higher EV to EBITDA ratio.”
Our calculations show that Sterling Construction Company, Inc. (NASDAQ: STRL) 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, Sterling Construction Company, Inc. was in 13 hedge fund portfolios, compared to 15 funds in the third quarter. STRL delivered a -0.13% 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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