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Jack Henry & Associates (JKHY), ‘A Laggard Stock’ Says Conestoga Capital

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Conestoga Capital Advisors, a boutique, independent investment management firm, published its fourth-quarter 2020 ‘Small Cap Growth & SMid Cap Growth’ Investor Letter – a copy of which can be downloaded here. A net return of 31% was recorded by Conestoga’s Small Cap Growth fund and 19.72% return by its SMid Cap Growth Fund for the the end year 2020. Both performed below their Russell 2000 Growth and Russell 2500 Growth benchmarks that delivered a 34.63% and 25.89% return respectively. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Conestoga Capital Advisors, in their Q4 2020 investor letter, emphasized that Jack Henry & Associates, Inc. (NASDAQ: JKHY) is among their SMid Cap Growth Fund’s top 5 laggards. Jack Henry & Associates, Inc. is a Missouri-based technology company that provides payment processing services for the finance industry. It currently has an $11.8 billion market capitalization. Since the beginning of the year, JKHY is down -4.44%, while its 12-month gains is up by 2.09%. As of March 5, the stock closed at $151.78 per share.

Here is what Conestoga Capital Advisors has to say about Jack Henry & Associates, Inc. in their Q4 2020 investor letter:

"This company provides core processing and other complementary software solutions to small and medium-sized banks and credit unions. Despite reporting solid fiscal first quarter results, improved business momentum and modestly higher annual guidance, the stock was mostly unchanged during the quarter and detracted from performance in the strong tape."

Our calculations show that Jack Henry & Associates, Inc. (NASDAQ: JKHY) 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, Jack Henry & Associates, Inc. was in 28 hedge fund portfolios compared to 30 funds in the third quarter. JKHY delivered a -2.27% 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.

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