Cedar Creek Partners, an investment management company, released its fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. In 2024, a few significant tech stocks and the NASDAQ remained at the top of the stock markets. The NASDAQ saw a gain of 28.6% for the year, while the S&P 500 (SPY) increased by 24.9%. Other monitored indices also delivered double-digit returns, with Cedar Creek achieving a 5.2% rise for the year, after accounting for fees and expenses. In addition, you can check the fund’s top 5 holdings to find out its best picks for 2024.
In its fourth quarter 2024 investor letter, Cedar Creek Partners emphasized stocks such as Evercel, Inc. (OTC:EVRC). Based in Miami, Florida Evercel, Inc. (OTC:EVRC) designs and manufactures printers and related consumables for various industrial printing applications. The one-month return of Evercel, Inc. (OTC:EVRC) was 8.05%, and its shares lost 72.08% of their value over the last 52 weeks. On February 25, 2025, Evercel, Inc. (OTC:EVRC) stock closed at $0.28 per share with a market capitalization of $48.458 billion.
Cedar Creek Partners stated the following regarding Evercel, Inc. (OTC:EVRC) in its Q4 2024 investor letter:
“We re-entered Evercel, Inc. (OTC:EVRC) after the Company strangely announced that any shares sold after February 26, 2024 do not include the rights to its minority investment in ZAGG, the maker of cell phone covers and screen protectors, which Evercel contributed to a liquidating trust. This is unlikely to be true in our opinion since there is no evidence that the transfer was reported to FINRA, no related security was issued, and trading was not halted. In those cases, the security typically trades with all rights attached. We decided to purchase shares after they plummeted for two reasons: 1. because in our opinion, we saw a great risk/reward opportunity believing the shares are trading with full rights to potential ZAGG proceeds, and 2. since we had previously sold some shares after February 26, 2024 that were held on February 26, 2024, we were effectively “hedged” on some of the shares we bought.
Shares are currently at $0.26 per share just a bit above our average cost basis. Evercel has 27.1 million shares for a market cap of just $7 million. ZAGG was purchased in 2021 for $200 million, $70 million of which was equity. Evercel paid $36 million for just over 50% equity ownership, which was later reduced to 40%. ZAGG was expected to generate about $500 million in sales. If ZAGG was still worth what Evercel paid in 2021 it would be worth $28 million or four times the price we paid. If sales have grown, and/or debt has been reduced, its value could be higher.”
An industrial printing machine churning out specialized orders for a major client.
Evercel, Inc. (OTC:EVRC) is not on our list of 30 Most Popular Stocks Among Hedge Funds. While we acknowledge the potential of Evercel, Inc. (OTC:EVRC) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
In addition, please check out our hedge fund investor letters Q4 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.