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Here’s Why White Brook Capital Sold its Host Hotels and Resorts (HST) Shares

·3 min read

White Brook Capital, an investment management firm, published its third-quarter 2021 investor letter – a copy of which can be downloaded here. A portfolio return of -5.86% was recorded by the fund for the third quarter of 2021, underperforming its S&P 400 benchmark that delivered a -1.76% return for the same period. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.

White Brook Capital, in its Q3 2021 investor letter, mentioned Host Hotels & Resorts, Inc. (NASDAQ: HST) and discussed its stance on the firm. Host Hotels & Resorts, Inc. is a Maryland, United States-based real estate investment trust company with an $11.9 billion market capitalization. HST delivered a 14.49% return since the beginning of the year, while its 12-month returns are up by 45.91%. The stock closed at $16.75 per share on October 21, 2021.

Here is what White Brook Capital has to say about Host Hotels & Resorts, Inc. in its Q3 2021 investor letter:

"Shares of Host Hotels (HST) were also sold during the 3rd quarter for similar reasons as Cogent given a degradation in the prospect of a return in group leisure and business travel. The capital was similarly redeployed."

High Yield REIT Dividend Stocks to Buy Now
High Yield REIT Dividend Stocks to Buy Now

Photo by Breno Assis on Unsplash

Based on our calculations, Host Hotels & Resorts, Inc. (NASDAQ: HST) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. HST was in 24 hedge fund portfolios at the end of the first half of 2021, compared to 25 funds in the previous quarter. Host Hotels & Resorts, Inc. (NASDAQ: HST) delivered a 5.28% return in the past 3 months.

Hedge funds’ reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn’t keep up with the unhedged returns of the market indices. Our research has shown that hedge funds’ small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by 115 percentage points since March 2017 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.

At Insider Monkey, we scour multiple sources to uncover the next great investment idea. For example, lithium mining is one of the fastest-growing industries right now, so we are checking out stock pitches like this emerging lithium stock. We go through lists like the 12 best EV stocks 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 homepage.

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