180 Degree Capital Corp., an investment management firm, recently released its first quarter 2024 investor letter. A copy of the letter can be downloaded here. In March, despite the market sell-off, the fund achieved a +4.7% gross total return from its cash and public-related securities, leading to a 2.8% gain in the NAV to $5.16. The firm believes that the economy will continue to show resilience, and its portfolio companies do not require lower rates to create value for shareholders. They benefit from positive economic trends and activism across many holdings. For more information on the fund’s top picks in 2024, please check its top five holdings.
180 Degree Capital Corp. highlighted stocks like Synchronoss Technologies, Inc. (NASDAQ:SNCR), in the first quarter 2024 investor letter. Synchronoss Technologies, Inc. (NASDAQ:SNCR) offers cloud, messaging, digital, and network management solutions. The one-month return of Synchronoss Technologies, Inc. (NASDAQ:SNCR) was 37.52%, and its shares gained 2.66% of their value over the last 52 weeks. On May 28, 2024, Synchronoss Technologies, Inc. (NASDAQ:SNCR) stock closed at $8.87 per share with a market capitalization of $95.727 million.
180 Degree Capital Corp. stated the following regarding Synchronoss Technologies, Inc. (NASDAQ:SNCR) in its first quarter 2024 investor letter:
“Synchronoss Technologies, Inc. (NASDAQ:SNCR): In February 2024, SNCR reported that it had completed post-divestiture cost removals that resulted in annual savings of approximately $15 million. In the same release, SNCR noted that it expected to report revenue and adj. EBITDA for Q4 2024 that met or exceeded the upper end of its original guidance. SNCR’s stock doubled after this announcement to a high near $14/share before retreating through the remainder of the quarter on no new information.
We joined SNCR’s Board of Directors in late 2023 with the purpose of helping the company create value as a newly pure-play cloud business. We don’t join boards because we want to clip coupons through board compensation. We only join if we are convinced that we can help a company enhance its return profile through specific actions or steps that we think we can help achieve through such active involvement. We believe there are plenty of opportunities for us to help SNCR and we hope that is evident as 2024 unfolds. The stock has literally retraced itself back to this year’s starting point and trades at, in our opinion, a low multiple of enterprise value/EBITDA (~5.5x) for a company with 75% gross margins, over 90% recurring revenues, and 25% EBITDA margins. We believe such companies, based on comparable valuations, could easily trade at 10x EBITDA, or $20 per share, which is more than triple the current share price.
For the quarter, SNCR increased NAV by $0.18/share, or $1.8million.”
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Synchronoss Technologies, Inc. (NASDAQ:SNCR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 3 hedge fund portfolios held Synchronoss Technologies, Inc. (NASDAQ:SNCR) at the end of the first quarter which was 3 in the previous quarter.
In the first quarter of 2024, Synchronoss Technologies, Inc. (NASDAQ:SNCR) saw a rise in total revenue to $43 million. An increase in cloud subscribers led to an improvement in revenue performance.
In another article, we discussed Synchronoss Technologies, Inc. (NASDAQ:SNCR) and shared 180 Degree Capital Corp’s views on the company in previous quarter. In addition, please check out our hedge fund investor letters Q1 2024 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
