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Lookback: Miller Value Partners 2019 OneMain Holdings (OMF) Thesis

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If you are looking for the best ideas for your portfolio you may want to consider some of Miller Value Partners top stock picks. Miller Value Partners, an investment management firm, is bullish on OneMain Holdings Inc. (NYSE:OMF) stock. In its Opportunity Equity Q3 2019 investor letter – you can download a copy here – the firm discussed its investment thesis on OneMain Holdings Inc. (NYSE:OMF) stock. OneMain Holdings Inc. (NYSE:OMF) is a financial services company.

On October 21, 2019, Miller Value Partners had released its Opportunity Equity Q3 2019 investor letter. The investment firm said that OneMain Holdings Inc. (NYSE:OMF) was one of the biggest contributors to its performance in Q3 2019. OneMain Holdings Inc. (NYSE:OMF) stock has posted a return of -4.7% in the trailing one year period, underperforming the S&P 500 Index which returned 15.1% in the same period. This suggests that the investment firm was wrong in its decision.

Miller Opportunity Equity fund posted a return of -1.81% in the third quarter of 2019, underperforming the S&P 500 Index which returned 1.70% in the same quarter. Let’s take a look at comments made by Miller Value Partners about OneMain Holdings Inc. (NYSE:OMF) stock in the Q3 2019 investor letter.

"OneMain Holdings Inc. (OMF) gained 15.2% as they reported 2Q results which beat expectations. The company reported adjusted EPS of $1.62 versus $1.34 expected with 2Q net charge-offs (NCO) of 6.2%. The company declared a special dividend of $2/share. The company increased its outlook with net receivables at year-end 2019 expected to grow by 8-10% compared to 5-10% previously and with the NCO rate expected to come in at 6.1-6.3% compared to <6.5% previously. The company continues to benefit from lower rates as the company has been able to refinance and issue new debt at very favorable costs, while also extending the duration of its funding."

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In June 2020, we published an article revealing Miller Value Partners' bullish investment thesis on OneMain Holdings Inc. (NYSE:OMF) stock in its Q1 2020 investor letter. This suggests that the investment firm has been bullish for a long time on OneMain Holdings Inc. (NYSE:OMF).

In Q2 2020, the number of bullish hedge fund positions on OneMain Holdings Inc. (NYSE:OMF) stock increased by about 9% from the previous quarter (see the chart here), so a number of other hedge fund managers believe in OneMain's growth potential. Our calculations showed that OneMain Holdings Inc. (NYSE:OMF) isn't ranked among the 30 most popular stocks among hedge funds.

The top 10 stocks among hedge funds returned 216% since the end of 2014 and outperformed the S&P 500 Index ETFs by more than 121 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. 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 10 most profitable companies in the world to pick the best large-cap stocks to buy. 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.