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Here’s Why Saturna Capital Sold EMCOR Group (EME)

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Saturna Capital Corporation, an investment management firm, published its fourth-quarter 2020 ‘Amana Mutual Funds Trust’ Investor Letter – a copy of which can be downloaded here. In the past year, a return of 13.95% was recorded by Amana Income Fund, 32.86% by Amana Growth Fund, 21.26% by Amana Developing World Fund, and 5.35% by Amana Participation Fund. You can view each fund’s top 5 holdings to have a peek at their top bets for 2021.

Saturna Capital Corporation, in their Q4 2020 investor letter, mentioned EMCOR Group, Inc. (NYSE: EME) and emphasized their views on the company. EMCOR Group, Inc. is a Connecticut-based mechanical and electrical construction company. It currently has an $5.9 billion market capitalization. Since the beginning of the year, EME delivered a 23.47% return, extending its 12-month gains to 105.55%. As of March 9, 2021, the stock closed at $107.33 per share.

Here is what Saturna Capital Corporation has to say about EMCOR Group, Inc. in their Q4 2020 investor letter:

"EMCOR focuses on electrical and mechanical construction and facilities services, which seems a difficult business given the acceleration of e-commerce and the likely persistence of remote work going forward. It’s interesting to note that the Amazon-inspired, oft-discussed “retail apocalypse” occurred over the course of two decades as 12% of retail sales shifted to the internet and overall sales were growing. What effect will the pull-forward of pandemic e-commerce have on the needs for retail space going forward? While EMCOR rebounded sharply with the announcement of a vaccine, we had sold it earlier in the year."

VPG electrician working with meter
VPG electrician working with meter

Copyright: kadmy / 123RF Stock Photo

Our calculations show that EMCOR Group, Inc. (NYSE: EME) 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, EMCOR Group, Inc. was in 25 hedge fund portfolios, compared to 29 funds in the third quarter. EME delivered a 25.91% 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.