Longleaf Partners, managed by Southeastern Asset Management, released its “Small-Cap Fund” first-quarter 2023 investor letter. A copy of the same can be downloaded here. The fund delivered 4.24% in the first quarter compared to a 2.74% return for the Russell 2000 Index and -0.66% for the Russell 2000 Value Index. The two dominant market factors, banking collapse and rebound in tech/growth businesses, in the quarter had not directly impacted the portfolio as the return drivers varied meaningfully from the Index. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Longleaf Partners Small-Cap Fund highlighted stocks like Oscar Health, Inc. (NYSE:OSCR) in the first quarter 2023 investor letter. Headquartered in New York, New York, Oscar Health, Inc. (NYSE:OSCR) is a health insurance company. On May 3, 2023, Oscar Health, Inc. (NYSE:OSCR) stock closed at $6.98 per share. One-month return of Oscar Health, Inc. (NYSE:OSCR) was 9.58%, and its shares lost 10.05% of their value over the last 52 weeks. Oscar Health, Inc. (NYSE:OSCR) has a market capitalization of $1.524 billion.
Longleaf Partners Small-Cap Fund made the following comment about Oscar Health, Inc. (NYSE:OSCR) in its Q1 2023 investor letter:
“Oscar Health, Inc. (NYSE:OSCR) – Health insurance and software platform Oscar Health was the top contributor in the quarter after the stock returned over 150% in the period. While tech businesses and other speculative stocks saw a rally in the first quarter, Oscar’s stock price move was a direct result of announcing a new CEO, Mark Bertolini. He has a fantastic track record as the long-time CEO of Aetna, which he shifted to be a more consumer-oriented plan and ultimately sold to CVS for $69 billion. Bertolini has been a strategic advisor to Oscar for the last year and knows the company well. He noted on the call announcing his appointment that he “believes in the mission” and the ability to “create significant shareholder value…as either a health plan or as a service to others.” His first priority is getting the health plan segment to positive adjusted EBITDA this year. The company reiterated at the end of the quarter that it is on track to achieve this metric. Not only does Bertolini taking the job provide validation of the business, but his compensation package uniquely aligns him in creating shareholder value. It consists of 10.3 million restricted shares, three-quarters of which only vest at stock price hurdles of $11, $16 and $39. Even after the large increase in the quarter, the stock trades at nearly half of the $11 threshold where Bertolini starts really getting paid.”
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Oscar Health, Inc. (NYSE:OSCR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 20 hedge fund portfolios held Oscar Health, Inc. (NYSE:OSCR) at the end of the fourth quarter which was 20 in the previous quarter.
We discussed Oscar Health, Inc. (NYSE:OSCR) in another article and shared Longleaf Partners Small-Cap Fund’s views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2023 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.
