Oakmark Funds, an investment management firm, published its “Oakmark Global Fund” third quarter 2021 investor letter – a copy of which can be seen here. A return of -3.33% was reported by the fund in the third quarter of 2021, which compares to a small loss for the MSCI World Index and -1.1% for the Lipper Global Fund Index. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.
Oakmark Funds, in its Q3 2021 investor letter, mentioned Tenet Healthcare Corporation (NYSE: THC) and discussed its stance on the firm. Tenet Healthcare Corporation is a Dallas, Texas-based multinational healthcare services company with an $8 billion market capitalization. THC delivered an 88.88% return since the beginning of the year, while its 12-month returns are up by 134.37%. The stock closed at $75.42 per share on November 5, 2021.
Here is what Oakmark Funds has to say about Tenet Healthcare Corporation in its Q3 2021 investor letter:
“Tenet may be best known as the second-largest public hospital chain in the U.S., but its largest business is outpatient acute care centers. In early 2020, investors fled the health care industry because of the great uncertainty that the pandemic presented. The early days of the pandemic were very hard on the hospital industry especially, but as the Covid-19 surge peaked and diminished, hospitals were able to schedule elective procedures and engage in profitable activities.”
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Based on our calculations, Tenet Healthcare Corporation (NYSE: THC) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds.THC was in 39 hedge fund portfolios at the end of the first half of 2021. Tenet Healthcare Corporation (NYSE: THC) delivered an 11.30% return in the past 3 months.
Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
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Disclosure: None. This article is originally published at Insider Monkey.
