Investment management company Cove Street Capital recently released its “Small Cap Value Fund” first quarter 2024 investor letter. A copy of the same can be downloaded here. In the first quarter, the fund returned 1.61% compared to 5.18% for the Russell 2000 Index and 2.90% for the Russell 2000 Value Index. The first quarter of calendar year 2024 was mostly more of the recent same. US investors focused on the Federal Reserve’s comments and still expecting interest rate cuts in 2024. In addition, you can check the top 5 holdings of the fund to know its best picks in 2024.
Cove Street Small Cap Value Fund featured stocks like Red Violet, Inc. (NASDAQ:RDVT) in the first quarter 2024 investor letter. Headquartered in Boca Raton, Florida, Red Violet, Inc. (NASDAQ:RDVT) is a software and services company. On April 10, 2024, Red Violet, Inc. (NASDAQ:RDVT) stock closed at $18.88 per share. One-month return of Red Violet, Inc. (NASDAQ:RDVT) was 4.71%, and its shares gained 16.90% of their value over the last 52 weeks. Red Violet, Inc. (NASDAQ:RDVT) has a market capitalization of $263.64 million.
Cove Street Small Cap Value Fund stated the following regarding Red Violet, Inc. (NASDAQ:RDVT) in its first quarter 2024 investor letter:
“Just before the end of the quarter, we were able to build a position in Red Violet, Inc. (NASDAQ:RDVT). RDVT is a software company that specializes in providing detailed background checks and identity verification to banks, insurance companies, private investigators, collection agencies, etc. Previously this management team built two other identity/background check solution companies. This is their third iteration focused on building a background check software from the ground up, but this time solely constructed on a cloud infrastructure. The previous versions are now owned by LexisNexis and TransUnion (Ticker: TRU) and are Red Violet’s current top competitors along with a company owned by Thomson Reuters (Ticker TRI). Together these companies control the majority of the identity verification market. Red Violet has a clear pathway to grow 10%+ organically with a history of adding incremental revenue at 30%+ EBITDA margins. This is a secularly growing “Buffett”, that we believe will be acquired by one of the aforementioned bigger players in 3 to 5 years. We were able to buy the shares directly from a top shareholder, a charity, who received the shares as a donation and was looking to monetize the position.”
A technician inserting a credit card into a point-of-sale machine for identity authentication.
Red Violet, Inc. (NASDAQ:RDVT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. At the end of the fourth quarter, Red Violet, Inc. (NASDAQ:RDVT) was held by 6 hedge fund portfolios, compared to 8 in the previous quarter, according to our database. 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.
