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Wasatch Global on Magnolia Oil (MGY): “Decision Paid Off in Q1, as MGY Gained More Than 60%”

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Wasatch Global Investors, an investment management firm, published its “Wasatch Small Cap Value Fund” first quarter 2021 investor letter – a copy of which can be downloaded here. A return of 15.42% was recorded by the fund’s investor class for the Q1 of 2021, trailing the benchmark, Russell 2000® Value Index, that rose to 21.17% for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Wasatch Small Cap Value Fund, in its Q1 2021 investor letter, mentioned Magnolia Oil & Gas Corporation (NYSE: MGY), and shared their insights on the company. Magnolia Oil & Gas Corporation is a Houston, Texas-based oil and gas exploration and production company that currently has a $2.9 billion market capitalization. Since the beginning of the year, MGY delivered a 70.96% return, extending its 12-month gains to 121.88%. As of May 10, 2021, the stock closed at $12.21 per share.

Here is what Wasatch Small Cap Value Fund has to say about Magnolia Oil & Gas Corporation in its Q1 2021 investor letter:

"An energy stock, Magnolia Oil & Gas Corp. (MGY), was one of our top contributors. Our approach to the energy sector isn’t to try to predict the direction of oil prices, since this is an extremely difficult task. Instead, we focus on owning well-positioned companies with sound balance sheets and management teams that are capable of navigating times of both positive and negative oil-price movements. Viewing Magnolia as one such company, we took advantage of last year’s selloff to add a position. That decision paid off in the first quarter, as the stock gained more than 60%."

Our calculations show that Magnolia Oil & Gas Corporation (NYSE: MGY) 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, Magnolia Oil & Gas Corporation was in 21 hedge fund portfolios, compared to 19 funds in the third quarter. MGY delivered a 23.19% 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.