Alphyn Capital Management, an investment management firm, published its first-quarter 2022 investor letter – a copy of which can be downloaded here. A quarterly portfolio net return of -13.4% was recorded by the fund for the first quarter of 2022, compared to its benchmark, the S&P 500 TR Index which delivered a -4.6% return for the same period. Try to spend some time taking a look at the fund’s top 5 holdings to be informed about their best picks for 2022.
In its Q1 2022 investor letter, Alphyn Capital Management mentioned Wayfair Inc. (NYSE:W) and explained its insights for the company. Founded in 2002, Wayfair Inc. (NYSE:W) is a Boston, Massachusetts-based e-commerce company with an $8.7 billion market capitalization. Wayfair Inc. (NYSE:W) delivered a -56.10% return since the beginning of the year, while its 12-month returns are down by -71.79%. The stock closed at $83.39 per share on April 28, 2022.
Here is what Alphyn Capital Management has to say about Wayfair Inc. (NYSE:W) in its Q1 2022 investor letter:
“In retrospect, I was too early with the initial investment in Wayfair. The price continued its decline in the first quarter as it became clear that the company could not sustain the revenue growth it achieved in 2020 when people spent more money on their homes during lockdowns. We used the volatility to buy more shares.
In prior years, Wayfair invested ahead of growth, and the company has historically been loss-making. However, as demonstrated in 2020, the existing infrastructure can handle increased volumes without a proportionate increase in costs, which will lead to improved unit economics as it fills its distribution capacity.
Wayfair’s scale and substantial investments in logistics greatly simplify its suppliers’ international shipping operations and often lower their international shipping costs, making Wayfair an attractive supplier partner. With 23,000 suppliers and an inventory-lite model, Wayfair offers consumers an unparalleled selection of 33m products and fast delivery due to its superior logistics. While it is tough to predict what will happen to revenues over the next quarter or 12 months, Wayfair’s reinforcing marketplace dynamics should allow it to capture a large share of the growing online home goods market, leading to sales growth and profitability.”
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Our calculations show that Wayfair Inc. (NYSE:W) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Wayfair Inc. (NYSE:W) was in 28 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 31 funds in the previous quarter. Wayfair Inc. (NYSE:W) delivered a -43.19% return in the past 3 months.
In March 2022, we also shared another hedge fund’s views on Wayfair Inc. (NYSE:W) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q1 page.
Disclosure: None. This article is originally published at Insider Monkey.
