Palm Valley Capital Management, an investment management firm, released “Palm Valley Capital Fund” second quarter 2023 investor letter. A copy of the same can be downloaded here. In the second quarter, Palm Valley Capital Fund returned 1.62% compared to a 3.38% rise for the S&P SmallCap 600 Index and a 5.60% return for the Morningstar Small Cap Index. The fund’s securities returned 4.78% before fees and the impact of cash during the quarter. Also, the fund ended the period with 82% held in cash equivalents. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Palm Valley Capital Fund highlighted stocks like Crawford & Company (NYSE:CRD-A) in the second quarter 2023 investor letter. Headquartered in Atlanta, Georgia, Crawford & Company (NYSE:CRD-A) is a claims management and outsourcing solutions provider for carriers, brokers, and corporations. On July 6, 2023, Crawford & Company (NYSE:CRD-A) stock closed at $10.32 per share. One-month return of Crawford & Company (NYSE:CRD-A) was 2.18%, and its shares gained 38.15% of their value over the last 52 weeks. Crawford & Company (NYSE:CRD-A)has a market capitalization of $470.592 million.
Palm Valley Capital Fund made the following comment about Crawford & Company (NYSE:CRD-A) in its second quarter 2023 investor letter:
“The three securities contributing most to the Fund’s second quarter return were Crawford & Company (NYSE:CRD-A), Oil Dri, and TrueBlue. Crawford’s stock has been jumpstarted this year by Hurricane Ian weather-related claims activity and a budding turnaround in its International segment. First quarter revenues increased 15% in constant currency and operating income doubled. The shares have traded at a depressed valuation for several years, reflecting stagnant operating performance, but they are now more fully pricing in Crawford’s normalized profitability.
One of the more interesting facts related to Crawford is the diverging performance between its voting and non-voting share classes. For most of the firm’s public history, the voting shares (CRD.B) have traded at a meaningful premium to the non-voting class (CRD.A). However, the company and its controlling shareholder have continued to mop up the voting class, draining its prospective liquidity. As a result, a couple years ago index providers switched Crawford’s representation to the non-voting share class. What was formerly a consistent 20%+ discount for the non-voting shares has morphed into a 20%+ premium. The Fund primarily owns Crawford’s non-voting shares because it has become more difficult to trade the other class. We have reduced our weighting in Crawford as the shares have closed in on our valuation.”
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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, 6 hedge fund portfolios held Crawford & Company (NYSE:CRD-A) at the end of first quarter which was 5 in the previous quarter. In addition, please check out our hedge fund investor letters Q2 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.
