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Why Nike (NKE) Deserves a Place in Your Portfolio

Aoris Investment Management recently released its Q1 2020 Investor Letter, a copy of which you can download below. The Aoris International Fund aims to generate returns of 8–12% p.a. over a market cycle. The portfolio is long-only and highly selective. You should check out Aoris Investment Management’s top 5 stock picks for investors to buy right now, which could be the biggest winners of the stock market crash. There weren’t a lot of funds who could deliver these kinds of returns without shorting the market or using aggressive put options.

In the said letter, Aoris Investment Management highlighted a few stocks and Nike Inc. (NYSE:NKE) is one of them. Nike is a footwear manufacturing company. Year-to-date, Nike Inc. (NYSE:NKE) stock lost 7.1% and on May 21st it had a closing price of $94.26. Here is what Aoris Investment Management said:

“Nike is the world’s largest athletic apparel and footwear brand. It benefits from a debt-free balance sheet, a strong culture and a long-serving executive team. Size and scale are huge advantages. For example, marketing firm Blueleadz ranked Nike the world’s most recognisable brand in 2019. None of its competitors even made the top 30.

Nike’s sales in 2020 will reflect the reality that retail stores have been closed for part of the year across the world. However, we expect Nike to take market share at an even faster than normal rate over the next couple of years, benefiting from its strong ecommerce platform, its ability to ramp up production and its supply chain as stores come back online, and its ability to remain relevant to and engaged with its customers while they are not shopping, via its apps and direct communication channels.”

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In Q4 2019, the number of bullish hedge fund positions on Nike Inc. (NYSE:NKE) stock increased by about 17% from the previous quarter (see the chart here), so a number of other hedge fund managers seem to agree with NKE’s growth potential. Our calculations showed that Nike Inc. (NYSE:NKE) isn’t 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 leave no stone unturned when looking for the next great investment idea. For example, we believe electric vehicles and energy storage are set to become giant markets, and we want to take advantage of the declining lithium prices amid the COVID-19 pandemic. So we asked astrophysicist Neil deGrasse Tyson about Tesla, Elon Musk, and his top stock picks. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. Our best call in 2020 was shorting the market when S&P 500 was trading at 3150 after realizing the coronavirus pandemic’s significance before most investors. You can subscribe to our free enewsletter below to receive our stories in your inbox:

Disclosure: None. This article is originally published at Insider Monkey.

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