Miller Value Partners recently released its Q1 2020 Investor Letter, a copy of which you can download here. The Miller Value Partners Opportunity Equity Fund posted a return of -38.4% for the quarter (net of fees), underperforming its benchmark, the S&P 500 Index which returned -19.6% in the same quarter. You should check out Miller Value Partners top 5 stock picks for investors to buy right now, which could be the biggest winners of the stock market crash.
In the said letter, Miller Value Partners highlighted a few stocks and American Airlines Group Inc. (NASDAQ:AAL) is one of them. American Airlines is an airline holding company. Year-to-date, American Airlines Group Inc. (NASDAQ:AAL) stock lost 47.1% and on June 10th it had a closing price of $17.02. Here is what Miller Value Partners said:
“We exited our position in American Airlines Group Inc. (AAL) leaving us with a return of -63.7% for the period. We transitioned our investment into United Airlines as we saw greater potential upside on a recovery and less balance sheet risk. American declined with the other airlines as a result of the COVID-19 pandemic. Earlier in the quarter the company had announced the extension of the 737 MAX’s planned absence from their schedules until Mid-August.”
Miller Value Partners believes that United Airlines Holdings Inc (NASDAQ:UAL) is a better growth stock compared to American Airlines Group Inc. (NASDAQ:AAL). Post COVID-19, United Airlines Holdings Inc (NASDAQ:UAL) is expected to emerge stronger due to a strong balance sheet.
In Q1 2020, the number of bullish hedge fund positions on American Airlines Group Inc. (NASDAQ:AAL) stock decreased by about 12% from the previous quarter (see the chart here), so a number of other hedge fund managers seem to agree with AAL’s downside potential. Our calculations showed that American Airlines Group Inc. (NASDAQ:AAL) and United Airlines Holdings Inc (NASDAQ:UAL) aren’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 leave no stone unturned when looking for the next great investment idea. For example, 2020’s unprecedented market conditions provide us with the highest number of trading opportunities in a decade. So we are checking out stocks recommended/scorned by legendary Bill Miller. We interview hedge fund managers and ask them about their best ideas. If you want to find out the best healthcare stock to buy right now, you can watch our latest hedge fund manager interview here. 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 the 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.
