Latest news with #SouthernSunAssetManagement
Yahoo
29-04-2025
- Business
- Yahoo
Here are the Main Challenges of U.S. Physical Therapy (USPH)
SouthernSun Asset Management, LLC, an investment management firm, released its 'SouthernSun SMID Cap Strategy' first quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, the strategy returned -8.60% on a gross basis (-8.76% net compared to a -7.50% return for the Russell 2500 Index and -5.83% for the Russell 2500 Value Index. The fund returned -9.41% on a gross basis (-10.06% net) over the trailing 12 months compared to -3.11% and -1.47% returns for the indexes, respectively, over the same period. In addition, please check the top 5 holdings of the strategy to know its best pick in 2025. In its first-quarter 2025 investor letter, SouthernSun SMID Cap Strategy highlighted stocks such as U.S. Physical Therapy, Inc. (NYSE:USPH). U.S. Physical Therapy, Inc. (NYSE:USPH) is an outpatient physical therapy clinic operator. The one-month return of U.S. Physical Therapy, Inc. (NYSE:USPH) was -1.55%, and its shares lost 30.14% of their value over the last 52 weeks. On April 28, 2025, U.S. Physical Therapy, Inc. (NYSE:USPH) stock closed at $71.24 per share with a market capitalization of $1.082 billion. SouthernSun SMID Cap Strategy stated the following regarding U.S. Physical Therapy, Inc. (NYSE:USPH) in its Q1 2025 investor letter: "U.S. Physical Therapy, Inc. (NYSE:USPH) was a top detractor in the SMID Cap strategy. Many things are going well at USPH; they have grown the top line at a 10% CAGR for the past 5 years, seen continued strong demand and improving productivity at their clinics, and the Industrial Injury Prevention business has shown good organic growth. However, in our opinion, they have two challenges: first, wages for front office and for clinical employees continue to rise; second, even though they have had good results in their negotiations with private payers (i.e. insurance companies), Medicare had yet another series of reimbursement cuts this year, and Medicare is about 30% of their business. As a result, EBITDA has been flat to declining (slightly) over the past 5 years. 2025 is the last year of mandated Medicare reimbursement cuts, and we believe management can navigate the rate environment as we move forward. In addition, we can see that the challenges in the market have adversely affected competition, and we believe USPH is in a position to grow it's moat in this current environment." A healthcare professional providing physical therapy to an elderly patient. U.S. Physical Therapy, Inc. (NYSE:USPH) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 16 hedge fund portfolios held U.S. Physical Therapy, Inc. (NYSE:USPH) at the end of the fourth quarter, compared to 16 in the third quarter. While we acknowledge the potential of U.S. Physical Therapy, Inc. (NYSE:USPH) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks. Disclosure: None. This article is originally published at Insider Monkey.
Yahoo
28-04-2025
- Business
- Yahoo
Does Watsco (WSO) have a Long Runway for Growth?
SouthernSun Asset Management, LLC, an investment management firm, released its 'SouthernSun SMID Cap Strategy' first quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, the strategy returned -8.60% on a gross basis (-8.76% net compared to a -7.50% return for the Russell 2500 Index and -5.83% for the Russell 2500 Value Index. The fund returned -9.41% on a gross basis (-10.06% net) over the trailing 12 months compared to -3.11% and -1.47% returns for the indexes, respectively, over the same period. In addition, please check the top 5 holdings of the strategy to know its best pick in 2025. In its first-quarter 2025 investor letter, SouthernSun SMID Cap Strategy highlighted stocks such as Watsco, Inc. (NYSE:WSO). Watsco, Inc. (NYSE:WSO) is a distributor of air conditioning, heating, and refrigeration equipment, and related parts and supplies. The one-month return of Watsco, Inc. (NYSE:WSO) was -18.821%, and its shares gained 2.52% of their value over the last 52 weeks. On April 25, 2025, Watsco, Inc. (NYSE:WSO) stock closed at $456.08 per share with a market capitalization of $18.821 billion. SouthernSun SMID Cap Strategy stated the following regarding Watsco, Inc. (NYSE:WSO) in its Q1 2025 investor letter: "Watsco, Inc. (NYSE:WSO), the largest distributor of air conditioning, heating, and refrigeration products in North America, was a top contributor this quarter, posting record fourth-quarter results with sales up 9% and EPS up 15%. Digital platform sales continue to outpace offline channels, now representing 36% of total revenue, and management remains committed to investing in proprietary technology solutions for contractors. The 2025 outlook appears favorable, as the rollout of higher-priced A2L refrigerant units from HVAC OEMs should be a tailwind to equipment pricing. With no debt and $782 million in cash and short-term investments, Watsco has significant flexibility to pursue acquisitions in the highly fragmented $74 billion North American HVAC/R distribution market. We continue to believe Watsco has a long runway for organic and inorganic growth, an owner-oriented culture and competitive advantages that increase with scale." A commercial air conditioning unit mounted atop a residential roof in a suburban neighbourhood. Watsco, Inc. (NYSE:WSO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 33 hedge fund portfolios held Watsco, Inc. (NYSE:WSO) at the end of the fourth quarter, compared to 37 in the third quarter. While we acknowledge the potential of Watsco, Inc. (NYSE:WSO) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks. Disclosure: None. This article is originally published at Insider Monkey.
Yahoo
28-04-2025
- Business
- Yahoo
Here's Why SouthernSun SMID Cap Strategy Maintains Its Confidence in Broadridge Financial Solutions (BR)
SouthernSun Asset Management, LLC, an investment management firm, released its 'SouthernSun SMID Cap Strategy' first quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, the strategy returned -8.60% on a gross basis (-8.76% net compared to a -7.50% return for the Russell 2500 Index and -5.83% for the Russell 2500 Value Index. The fund returned -9.41% on a gross basis (-10.06% net) over the trailing 12 months compared to -3.11% and -1.47% returns for the indexes, respectively, over the same period. In addition, please check the top 5 holdings of the strategy to know its best pick in 2025. In its first-quarter 2025 investor letter, SouthernSun SMID Cap Strategy highlighted stocks such as Broadridge Financial Solutions, Inc. (NYSE:BR). Headquartered in Lake Success, New York, Broadridge Financial Solutions, Inc. (NYSE:BR) is an investor communications and technology-driven solutions provider for the financial services industry. The one-month return of Broadridge Financial Solutions, Inc. (NYSE:BR) was -1.47% and its shares gained 21.49% of their value over the last 52 weeks. On April 25, 2025, Broadridge Financial Solutions, Inc. (NYSE:BR) stock closed at $238.13 per share with a market capitalization of $27.866 billion. SouthernSun SMID Cap Strategy stated the following regarding Broadridge Financial Solutions, Inc. (NYSE:BR) in its Q1 2025 investor letter: "Broadridge Financial Solutions, Inc. (NYSE:BR), the leading processor of proxy voting and fixed income trading in the U.S., was a top contributor in the first quarter. Results slightly exceeded our expectations, driven by a major mutual fund complex conducting board elections and relying on BR to process the proxies. More importantly, the outlook for the upcoming equity proxy season improved as equity position growth, which had been trending around 7%, began to pick up in October and was +11% for the quarter. Management now anticipates low double-digit equity position growth in the upcoming proxy season, up from prior expectations of mid-single-digit growth. Management also highlighted rising M&A activity and with net debt/EBITDA at approximately 2x, BR has the capacity to pursue strategic acquisitions. Overall, we remain confident in BR's strong competitive position, its ability to grow organically with minimal capital investment, and its skilled leadership team led by CEO Tim Gokey." A successful investor looking over a graph on a laptop charting a company's performance. Broadridge Financial Solutions, Inc. (NYSE:BR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 35 hedge fund portfolios held Broadridge Financial Solutions, Inc. (NYSE:BR) at the end of the fourth quarter, compared to 33 in the third quarter. While we acknowledge the potential of Broadridge Financial Solutions, Inc. (NYSE:BR) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks. Disclosure: None. This article is originally published at Insider Monkey.
Yahoo
28-04-2025
- Business
- Yahoo
Live Oak Bancshares (LOB) Fell on Increased Loan Loss Provisions Amid Recession Concerns and Low-Rate Loans
SouthernSun Asset Management, LLC, an investment management firm, released its 'SouthernSun Small Cap Strategy' first quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, the strategy returned -11.32% on a gross basis (-11.48% net) compared to a -9.48% return for the Russell 2000 Index and -7.74% for the Russell 2000 Value Index. The strategy returned -12.55% on a gross basis (-13.21% net) for the trailing twelve months compared to -4.01% and -3.12% respectively for the indexes over the same period. In addition, please check the top 5 holdings of the strategy to know its best pick in 2025. In its first-quarter 2025 investor letter, SouthernSun Small Cap Strategy highlighted stocks such as Live Oak Bancshares, Inc. (NYSE:LOB). Headquartered in Wilmington, North Carolina, Live Oak Bancshares, Inc. (NYSE:LOB) is a bank holding company for Live Oak Banking Company that offers commercial banking products and services. The one-month return of Live Oak Bancshares, Inc. (NYSE:LOB) was -0.26%, and its shares lost 20.58% of their value over the last 52 weeks. On April 25, 2025, Live Oak Bancshares, Inc. (NYSE:LOB) stock closed at $12.49 per share with a market capitalization of $1.212 billion. SouthernSun Small Cap Strategy stated the following regarding Live Oak Bancshares, Inc. (NYSE:LOB) in its Q1 2025 investor letter: "Live Oak Bancshares, Inc. (NYSE:LOB) was a top detractor in the first quarter in the Small Cap strategy. Live Oak continues to execute well on its unique approach of lending to small businesses as evidenced by the reported $1.4 billion of loan originations in the fourth quarter, which was the second highest quarter of originations in the company's history. Management also reported continued strength in the loan pipeline and positive small business sentiment based on both government surveys as well as Live Oak's own internal surveys. The stock has been under pressure primarily due to the elevated provision for loan losses that the company has recorded in recent quarters as well as the macro environment and increased probability for a recession in the US. Much of the provision expense relates to loans originated between 2020 and 2022 when interest rates were at historically low levels. The vast majority of Live Oak's loans are floating rate, and borrowers have had to absorb the rapid increase in interest rates that occurred primarily during 2023. Approximately 70% of defaults were loans that had interest rate increases of 4% or more since origination. While Live Oak may continue to record elevated provision for loan losses for a few more quarters, we believe that recent trends are part of a normal credit cycle and not indicative of lower credit standards. We believe Live Oak's differentiated model of leveraging leading edge technology to deliver superior service to small business borrowers will allow it to create significant value to shareholders over the long-term." A close-up of financial documents on a desk, indicating the banking products that the company provides. Live Oak Bancshares, Inc. (NYSE:LOB) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 12 hedge fund portfolios held Live Oak Bancshares, Inc. (NYSE:LOB) at the end of the fourth quarter, compared to 10 in the third quarter. While we acknowledge the potential of Live Oak Bancshares, Inc. (NYSE:LOB) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. In another article, we covered Live Oak Bancshares, Inc. (NYSE:LOB) and shared the list of oversold bank stocks to buy. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
Yahoo
28-04-2025
- Automotive
- Yahoo
What Makes Modine Manufacturing Company (MOD) an Investment Bet?
SouthernSun Asset Management, LLC, an investment management firm, released its 'SouthernSun Small Cap Strategy' first quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, the strategy returned -11.32% on a gross basis (-11.48% net) compared to a -9.48% return for the Russell 2000 Index and -7.74% for the Russell 2000 Value Index. The strategy returned -12.55% on a gross basis (-13.21% net) for the trailing twelve months compared to -4.01% and -3.12% respectively for the indexes over the same period. In addition, please check the top 5 holdings of the strategy to know its best pick in 2025. In its first-quarter 2025 investor letter, SouthernSun Small Cap Strategy highlighted stocks such as Modine Manufacturing Company (NYSE:MOD). Modine Manufacturing Company (NYSE:MOD) offers thermal management products and solutions. The one-month return of Modine Manufacturing Company (NYSE:MOD) was 5.71%, and its shares lost 15.08% of their value over the last 52 weeks. On April 25, 2024, Modine Manufacturing Company (NYSE:MOD) stock closed at $81.13 per share with a market capitalization of $4.265 billion. SouthernSun Small Cap Strategy stated the following regarding Modine Manufacturing Company (NYSE:MOD) in its Q1 2025 investor letter: "Modine Manufacturing Company (NYSE:MOD) is an over 100-year-old thermal management company based in Racine, WI. The company started out producing heat exchangers for tractors but quickly expanded into the automotive market and became a major supplier of heat exchangers to leading car manufacturers. As demand for automobiles increased significantly throughout the 20th century, Modine expanded operations globally. However, as the automotive market matured and became more competitive, MOD's growth slowed, and the company went through numerous restructurings to take cost out of the business. The company attempted to diversify into the HVAC industry by buying Airedale in 2005 and Luvata in 2016, but management lacked a clear strategic vision, and the legacy automotive business continued to attract most of the time and resources. A technician in a factory, assembling a gas-fired unit heater. Modine Manufacturing Company (NYSE:MOD) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 43 hedge fund portfolios held Modine Manufacturing Company (NYSE:MOD) at the end of the fourth quarter, compared to 32 in the third quarter. While we acknowledge the potential of Modine Manufacturing Company (NYSE:MOD) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. In another article, we covered Modine Manufacturing Company (NYSE:MOD) and shared the list of best guru stocks to buy according to Wall Street analysts. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks. Disclosure: None. This article is originally published at Insider Monkey.
