Palm Valley Capital Management, an investment management firm, released its first quarter 2023 investor letter. A copy of the same can be downloaded here. In the first quarter, Palm Valley Capital Fund returned 3.01% compared to a 2.57% rise for the S&P SmallCap 600 Index and a 4.90% return for the Morningstar Small Cap Index. The fund’s securities returned 12.2% during the quarter. The fund’s performance early in the quarter was below its benchmark while closing the gap by quarter end. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Palm Valley Capital Management highlighted stocks like Crawford & Company (NYSE:CRD-A) in the first quarter 2023 investor letter. Headquartered in Atlanta, Georgia, Crawford & Company (NYSE:CRD-A) is a claims management and outsourcing solutions provider. On April 6, 2023, Crawford & Company (NYSE:CRD-A) stock closed at $9.04 per share. One-month return of Crawford & Company (NYSE:CRD-A) was 31.01%, and its shares gained 19.58% of their value over the last 52 weeks. Crawford & Company (NYSE:CRD-A) has a market capitalization of $428.673 million.
Palm Valley Capital Management made the following comment about Crawford & Company (NYSE:CRD-A) in its Q1 2023 investor letter:
“During the quarter, the three securities having the greatest positive impact on the Fund’s returns were Crawford & Company (NYSE:CRD-A), Miller Industries (ticker: MLR), and Gencor Industries (ticker: GENC). Crawford’s shares had underperformed since the pandemic but surged in March after the firm’s fourth quarter earnings release. Results for the period were supported by activity related to severe weather, including Hurricane Ian and Winter Storm Elliott. Constant currency revenues jumped 15% in Q4. Operating profit before amortization reached its highest level since the third quarter of 2020, when results benefited from claims activity tied to Hurricane Laura. Management expressed optimism that Crawford’s margin improvement can continue, including from the firm’s struggling International division.
We believe Crawford’s valuation had been locked in the basement because of the firm’s meandering results, since the company has struggled to grow earnings even though it maintains leading positions in multiple service lines. Crawford’s stock jumped on heavy volume and no material news during the final week of the quarter. While we imagine a path to higher profitability will not be smooth and will be impacted by the frequency and severity of global weather events, we believe recent share price appreciation places the valuation in territory that makes more sense given Crawford’s fundamentals.”
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Crawford & Company (NYSE:CRD-A) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 5 hedge fund portfolios held Crawford & Company (NYSE:CRD-A) at the end of the fourth quarter which was 7 in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2023 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.
