Wedgewood Partners, an investment management company, released its “Focused SMID Cap Strategy” third quarter 2022 investor letter. A copy of the same can be downloaded here. In the third quarter, the fund returned -5.3% compared to a return of -2.8% for the Russell 2500 Index. Since inception, the fund returned 8.2% compared to 5.4% for its benchmark index. In addition, please check the fund’s top five holdings to know its best picks in 2022.
Wedgewood Partners highlighted stocks like Leidos Holdings, Inc. (NYSE:LDOS) in its third-quarter 2022 investor letter. Headquartered in Reston, Virginia, Leidos Holdings, Inc. (NYSE:LDOS) is a provider of services and solutions in the defense, intelligence, civil, and health markets. On November 3, 2022, Leidos Holdings, Inc. (NYSE:LDOS) stock closed at $106.68 per share. One-month return of Leidos Holdings, Inc. (NYSE:LDOS) was 16.75% and its shares gained 10.45% of their value over the last 52 weeks. Leidos Holdings, Inc. (NYSE:LDOS) has a market capitalization of $14.671 billion.
Wedgewood Partners made the following comment about Leidos Holdings, Inc. (NYSE:LDOS) in its Q3 2022 investor letter:
“Leidos Holdings, Inc. (NYSE:LDOS) detracted from performance as the Company’s book-to-bill came in below market expectations. The significant change in the global defense situation to date has caused some near-term pauses and noise around the ramping of different projects and priorities. Leidos is positioned exceedingly well as a defense contractor, particularly to the U.S. and its allies, as we expect a significant increase in U.S. government defense and civilian spending during fiscal 2023. This increased spending should in turn flow through to Leidos’ order book, as it focuses on modernizing IT environments and cybersecurity. We continue to hold Leidos as a top weighting because it still trades at an historically attractive forward earnings multiple, despite outperforming year to date.
As we continue to familiarize our clients with our Focused SMID portfolio, we wish to introduce Leidos, one of our largest holdings in the portfolio. Leidos is a technology, science, and engineering service provider primarily to the U.S. government, with a significant focus on the U.S. military and intelligence communities. Large customers include the U.S. Department of Defense (DoD), the U.S. Intelligence community, the Department of Homeland Security, and Federal Aviation Administration, plus the Department of Veteran Affairs. Aside from the U.S. government, which represents nearly 90% of the Company’s revenues, Leidos also provides services to some commercial customers and to allied foreign governments and their military and intelligence services. Leidos has grown over several decades from a base of scientific and engineering expertise into a provider of a variety of services, retaining a primary focus on advanced technological areas, but spreading into many tangential areas where the Company’s scale, and its long relationships with its customer base, have allowed it grow…” (Click here to read the full text)
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Leidos Holdings, Inc. (NYSE:LDOS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 29 hedge fund portfolios held Leidos Holdings, Inc. (NYSE:LDOS) at the end of the second quarter which was 19 in the previous quarter.
We discussed Leidos Holdings, Inc. (NYSE:LDOS) in another article and shared the best prison and law enforcement stocks to buy. In addition, please check out our hedge fund investor letters Q3 2022 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
