Latest news with #SouthernSunSMIDCapStrategy
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.
