Miller Value Partners, an investment management firm, published its ‘Opportunity Equity’ fourth-quarter 2020 Investor Letter – a copy of which can be seen here. A net return of 35.4% was recorded by the fund for the Q4 of 2020, outperforming its S&P 500 benchmark that delivered a 12.15% return. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.
Miller Value Partners, in their Q4 2020 Investor Letter, said that Desktop Metal, Inc. (NYSE: DM) is one of their current top holdings. Desktop Metal, Inc. is a technology manufacturing company that currently has a $6.9 billion market cap. For the past 3 months, DM delivered an impressive 193.17% return and settled at $30.49 per share at the closing of February 12th.
Here is what Miller Value Partners has to say about Desktop Metal, Inc. in their Q4 2020 investor letter:
“Desktop Metal is a name that made it into our top holdings at the end of year due to strong performance since our purchase at the end of the third quarter. The company is a second-generation industrial printing company led by a great team. It came public through a merger with a SPAC led by Leo Hindery, Jr. who we’ve known from his successful history at Telecommunications, Inc (TCI) where they excelled at capital allocation. One of the unique benefits of structure is that it helps us get access to unique opportunities. Here, we were able to invest in the PIPE (private investment in public equity) to take the company public based on industry relationships.
Desktop Metal is early in its commercialization, but we think the company has great potential over the next five years with a stellar list of customer partners and potential applications. We bought on the deal at a $1.8B enterprise value or 6.7x the EBITDA management estimates it can earn in 5 years before any acquisitions. For a company capable of growing at such high rates (triple digits for next couple years), with a great business with high moats and a fantastic team, this was a great deal. It’s doubled since the deal. This is a great example of an undervalued, long-term, growth-oriented opportunity that we were still able to source in this market.”
Pixabay/Public Domain
DM delivered an immense 201.88% return in the past 12 months. Our calculations show that Desktop Metal, Inc. (NYSE: DM) does not belong in our list of the 30 most popular stocks among hedge funds.
The top 10 stocks among hedge funds returned 216% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 121 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
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Disclosure: None. This article is originally published at Insider Monkey.
