If you are looking for the best ideas for your portfolio you may want to consider some of Greenlight Capital’s top stock picks. Greenlight Capital, an investment management firm, is bullish on DXC Technology Co (NYSE:DXC) stock. In its Q4 2019 investor letter – you can download a copy here – the firm discussed its investment thesis on DXC Technology Co (NYSE:DXC) stock. DXC Technology Co (NYSE:DXC) is an internet service provider. The stock is down 56.3% since the Greenlight Capital’s pitch in January 2020, which suggests the investment firm was wrong in its decision. On a year-to-date basis, DXC Technology Co (NYSE:DXC) stock has fallen by 59.7%.
On January 21, 2020, Greenlight Capital had released its Q4 2019 Investor Letter. Greenlight Capital said that DXC Technology Co (NYSE:DXC) stock is poised to grow in 2020.
In 2019, the Greenlight Capital Fund recorded a return of 13.8% as compared to 31.5% of the S&P 500 Index.
Let’s take a look at comments made by Greenlight Capital about DXC Technology Co (NYSE:DXC) in the letter.
“DXC Technology (DXC) is an IT services company created in 2017 through the combination of Computer Sciences Corporation and the Enterprise Services division of Hewlett Packard Enterprise. After a difficult post-merger period that resulted in substantial lost business, DXC brought on a new CEO with previous experience managing a successful turnaround of a similar operation. Subsequently, the company has announced a new strategy to refocus on DXC’s core business and leverage it with clients. DXC also lowered earnings expectations through 2022. The company has begun the process of divesting ancillary businesses totaling about 25% of revenue, with the proceeds targeted to pay down debt and buy back over onethird of shares outstanding over the next 10 quarters. We believe many of the challenges at the company are self-inflicted and can be fixed. Our field research reveals early signs that improvement is underway, and at our average purchase price of $36.54 (7x the reduced current year consensus earnings) we think little of that is priced in. DXC ended the quarter at $37.59.”
In Q1 2020, the number of bullish hedge fund positions on DXC Technology Co (NYSE:DXC) stock decreased by about 13% from the previous quarter (see the chart here), so a number of other hedge fund managers don’t seem to agree with DXC’s growth potential. Our calculations showed that DXC Technology Co (NYSE:DXC) isn’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 scour multiple sources to uncover the next great investment idea. There is a lot of volatility in the markets and this presents amazing investment opportunities from time to time. For example, this trader claims to deliver juiced up returns with one trade a week, so we are checking out his highest conviction idea. A second trader claims to score lucrative profits by utilizing a “weekend trading strategy”, so we look into his strategy’s picks. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. We recently recommended several stocks partly inspired by legendary Bill Miller’s investor letter. Our best call in 2020 was shorting the market when the S&P 500 was trading at 3150 in February 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.
