We recently compiled a list of the Billionaire Mason Hawkins’ Top 15 Long-Term Stock Picks. In this article, we are going to take a look at where Affiliated Managers Group, Inc. (NYSE:AMG) stands against the other stocks.
Mason Hawkins is a prominent figure in the world of value investing, best known as the founder and chairman of Southeastern Asset Management, an investment firm established in 1975. The firm began with a modest pool of assets but grew to manage approximately $20 billion within a few years. With decades of experience and a reputation for disciplined investment strategies, Hawkins has earned widespread respect among investors and financial professionals for his long-term approach to wealth creation. His firm specializes in managing concentrated portfolios based on in-depth research, fundamental analysis, and a value-oriented philosophy. Hawkins believes that patience and a contrarian mindset are critical to success, often holding onto investments for years to allow their true value to emerge.
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This strategy has been central to the success of the flagship Longleaf Partners Funds run by Southeastern Asset Management. For example, during the 20 years leading up to the mid-2000s, the fund achieved an annualized return of approximately 12%, compared to around 10% for the S&P 500. A native of Tennessee, Hawkins graduated from the University of Florida with a degree in Finance and later earned his MBA from the University of Georgia. His early career included roles at Atlantic National Bank and First Tennessee Investment Management before he decided to establish Southeastern Asset Management. Under his leadership, the firm grew from managing a small pool of assets to overseeing billions of dollars across various funds.
One hallmark of the investment style made popular by Hawkins is his emphasis on what he calls a “margin of safety.” This concept, pioneered by Benjamin Graham, involves purchasing stocks at a significant discount to their estimated intrinsic value. By doing so, Hawkins aims to minimize downside risk while maximizing potential returns. This disciplined approach has helped Southeastern Asset Management weather multiple market cycles, including challenging periods like the dot-com bubble and the 2008 financial crisis. Hawkins focuses on quality rather than quantity, reflected in the 13F portfolio of his fund that typically holds positions in twenty to thirty stocks, highlighting a preference for concentration rather than diversification. This approach allows the firm to take significant positions in companies it believes in, leading to outsized returns when these investments succeed.
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For this article, we selected stocks by combing through the 13F portfolio of Southeastern Asset Management at the end of the third quarter of 2024. Only the companies that have been in the 13F portfolio of the fund consistently for the past three years were selected. These stocks are also popular among other hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
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Affiliated Managers Group, Inc. (NYSE:AMG)
Number of Hedge Fund Holders: 33
Affiliated Managers Group, Inc. (NYSE:AMG) operates as an investment management company providing investment management services to mutual funds, institutional clients, retails and high net worth individuals in the United States. By the end of the third quarter in 2024, Southeastern Asset Management reported owning 724,829 shares in the company, worth upwards of $128.8 million, accounting for 6.07% of its 13F portfolio. The firm is one of the top long term stock picks of billionaire Mason Hawkins. It has been a part of the 13F portfolio of the fund since the third quarter of 2018. In the fourth quarter of 2022, after slashing its stake in the company by over 42%, the hedge fund has steadily continued to sell the stock, although the percentage sold has not been as noteworthy.
Overall AMG ranks 3rd on our list of Billionaire Mason Hawkins’ top long-term stock picks. While we acknowledge the potential of AMG as an investment, our conviction lies in the belief that some stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a stock that is more promising than AMG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
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