Greenwood Investors LLC, an investment management firm, published its third-quarter 2021 investor letter – a copy of which can be downloaded here. A quarterly net loss of -7.7% (+11.5% YTD) was delivered by its Global Micro Fund for the third quarter of 2021, and this compares to its benchmark, the MSCI ACWI index returning -1.1% in the quarter (+11.5% YTD) for the same period. You can take a look at the fund’s top 5 holdings to have an idea about their best picks for 2021.
Greenwood Investors, in its Q3 2021 investor letter, mentioned CatchMark Timber Trust, Inc. (NYSE: CTT) and discussed its stance on the firm. CatchMark Timber Trust, Inc. is an Atlanta, Georgia-based real estate investment trust company with a $407.2 million market capitalization. CTT delivered a -11.00% return since the beginning of the year, while its 12-month returns are down by -15.60%. The stock closed at $8.33 per share on November 25, 2021.
Here is what Greenwood Investors has to say about CatchMark Timber Trust, Inc. in its Q3 2021 investor letter:
“One of the biggest differentiations between good and great investments, that is often overlooked, is the value added by good capital allocation- be it with a very well-done merger, opportunistic buyback or even more, venture-style investments that are almost in no one’s “model” or perception. Small acquisitions that bring new tools and managers can often upgrade the business model. As Clayton Christensen suggested in The Big Idea: The New M&A Playbook, these are often the most overlooked investments.
But during the quarter, when posed with the question of how to best allocate capital over the long term, I found myself tongue tied. For it’s a dynamic and reflexive question to ask. It’s easy to see what to do right now, and where to build in the next few years. But sound capital allocation is a function of the opportunities that present themselves. It is also about creating new possibilities, particular ones that competitors don’t see.
At CTT, with defensive, problem-solving actions becoming less of a focus, attention can now turn to offense. What that looks like in the near term, at least to me, should be continued progress and convergence on the strategy to become the Shopify of Iberia. With Portugal e-commerce order frequency at very small fractions of neighboring Spain, we believe it is CTT’s responsibility to make itself the most convenient and most cost effective way of conducting commerce. Through more parcel lockers, better digital tools, while maintaining or improving on best-in-class quality of service, we believe much of the responsibility to make online the most convenient commerce channel in Portugal will fall on CTT’s shoulders. Going further with online shop enabling, more cost effective payments tools, and an integrated fulfillment offer, that continues through to returns and customer service, it has every tool it needs to enable this digital transition. This convergence is happening at the same time EU recovery stimulus dollars will be directed towards
digitalizing the economy.Case studies like Kaspi, which started as a bank, evolved into a payments company, then launched an e-commerce marketplace and then further expanded into logistics, provide more inspiration than any company in the logistics industry. This reminds me of Google’s earliest days, when its managers encouraged their teams to ignore the traditional competitors and instead go where other competitors hadn’t dared to venture- into the unknown.
We believe CTT has greater competitive advantages than some “new economy” companies playing throughout the same e-commerce value chain, often trading at significantly higher valuation multiples. Whether we’re talking about fulfillment services, parcel lockers, or alternative purchase financing, it’s the customer relationship that differentiates and builds competitive advantages. That is why one of the first priorities of the new management was to improve customer satisfaction. And while some analysts that cover the company still use traditional methods to frame the opportunity, the shareholder base has largely transitioned away from income-oriented investors. More like-minded shareholders, aligned with management, can enable the team to build something truly great.”
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Based on our calculations, CatchMark Timber Trust, Inc. (NYSE: CTT) was not able to clinch a spot in our list of the 30 Most Popular Stocks Among Hedge Funds. CTT was in 9 hedge fund portfolios at the end of the third quarter of 2021, compared to 12 funds in the previous quarter. CatchMark Timber Trust, Inc. (NYSE: CTT) delivered a -28.74% return in the past 3 months.
Disclosure: None. This article is originally published at Insider Monkey.
