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Alger Weatherbie Remains Optimistic in LendingTree (TREE) Despite its Poor Performance

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Jose Karlo Mari Tottoc
·3 min read
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Alger, an investment management firm, published its ‘Alger Weatherbie Specialized Growth Fund’ fourth quarter 2020 investor letter – a copy of which can be downloaded here. In the letter, the fund highlighted their largest portfolio sector weightings, which is in Information Technology and Health Care sector, with their comments on notable companies. The Financials sector together with the Health Care sector is where they achieved the largest chunk of their returns. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Alger Weatherbie Specialized Growth Fund, in their Q4 2020 investor letter, mentioned LendingTree, Inc. (NASDAQ: TREE) and emphasized their views on the company. LendingTree, Inc. is a North Carolina-based online lending marketplace that currently has a $3.2 billion market capitalization. Since the beginning of the year, TREE delivered a -12.01% return, while its 12-month gains are also down by -0.22%. As of March 15, 2021, the stock closed at $240.92 per share.

Here is what Alger Weatherbie Specialized Growth Fund has to say about LendingTree, Inc. in their Q4 2020 investor letter:

"LendingTree, Inc. operates a leading online platform that connects consumers with the providers of various types of financial products. Through multiple branded marketplaces such as LendingTree and QuoteWizard, etc., consumers can connect to a network of more than 800 financial partners for mortgage loans, mortgage refinances, credit cards, insurance quotes, personal loans and other products.

LendingTree is a dominant player in online mortgage comparison shopping, but that market is somewhat mature and results have been erratic from quarter to quarter depending on the interest rates. The company's results have been negatively impacted in the current Covid-19-related environment. However, LendingTree has historically seen significant growth both organically and through acquisitions, and we believe the company is well-positioned to recover once the economy normalizes."

Pixabay/Public Domain

Our calculations show that LendingTree, Inc. (NASDAQ: TREE) does not belong in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, LendingTree, Inc. was in 26 hedge fund portfolios, compared to 20 funds in the third quarter. TREE delivered a -11.05% return in the past 3 months.

The top 10 stocks among hedge funds returned 231.2% between 2015 and 2020, and outperformed the S&P 500 Index ETFs by more than 126 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. Here you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, Federal Reserve has been creating trillions of dollars electronically to keep the interest rates near zero. We believe this will lead to inflation and boost real estate prices. So, we recommended this real estate stock to our monthly premium newsletter subscribers. We go through lists like the 15 best innovative stocks to buy to pick the next Tesla that will deliver a 10x return. Even though we recommend positions in only a tiny fraction of the companies we analyze, we check out as many stocks as we can. We read hedge fund investor letters and listen to stock pitches at hedge fund conferences. You can subscribe to our free daily newsletter on our website:

Disclosure: None. This article is originally published at Insider Monkey.