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Miller Value Partners Is Bullish on Diamondback Energy (FANG)

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Jose Karlo Mari Tottoc
·3 min read
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Miller Value Partners, an investment management firm, published its ‘Opportunity Equity’ fourth-quarter 2020 Investor Letter – a copy of which can be seen here. A net return of 35.4% was recorded by the fund for the Q4 of 2020, outperforming its S&P 500 benchmark that delivered a 12.15% return. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Miller Value Partners, in their Q4 2020 Investor Letter, said Diamondback Energy, Inc. (NASDAQ: FANG) was added in their portfolio in the fourth quarter of 2020. Diamondback Energy, Inc. is an energy company that currently has a $10.9 billion market cap. For the past 3 months, FANG delivered an impressive 105.71% return and settled at $69.12 per share at the closing of February 12th.

Here is what Miller Value Partners has to say about Diamondback Energy, Inc. in their Q4 2020 investor letter:

"We also bought Diamondback Energy. For the first time in decades, we find energy to be quite attractive. Companies are finally focusing on cash flow and returns. Diamondback is a low-cost shale producer that screened well on a number of metrics we pay attention to (dividend yield, free cash flow yield, discounted cash flow, and insider buying). They recently added ROIC to their management incentive compensation. They plan to continue to pay down debt and maintain the dividend. The company is obviously levered to increasing oil prices."

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Copyright: Elnur / 123RF Stock Photo

Last September, we published an article telling that Diamondback Energy, Inc. (NASDAQ: FANG) was in 29 hedge fund portfolios. Its all time high statistics is 47. FANG delivered a decent 42.81% return YTD.

Our calculations show that Diamondback Energy, Inc. (NASDAQ: FANG) does not belong in our list of 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

https://youtu.be/OgBhPDmWMtI

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.