Wasatch Global Investors, an asset management company, released its “Wasatch Micro Cap Value Strategy” fourth-quarter 2023 investor letter. A copy of the same can be downloaded here. The strategy posted a double-digit gain in the fourth quarter but trailed the benchmark Russell Microcap Index which rose 16.06%. In 2023, the strategy appreciated and outperformed the benchmark’s 9.33% return. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Wasatch Micro Cap Value Strategy featured stocks like GEN Restaurant Group, Inc. (NASDAQ:GENK) in the fourth quarter 2023 investor letter. Headquartered in Cerritos, California, GEN Restaurant Group, Inc. (NASDAQ:GENK) operates restaurants. On March 12, 2024, GEN Restaurant Group, Inc. (NASDAQ:GENK) stock closed at $6.28 per share. One-month return of GEN Restaurant Group, Inc. (NASDAQ:GENK) was -27.48%, and its shares lost 19.80% of their value over the last 52 weeks. GEN Restaurant Group, Inc. (NASDAQ:GENK) has a market capitalization of $380.054 million.
Wasatch Micro Cap Value Strategy stated the following regarding GEN Restaurant Group, Inc. (NASDAQ:GENK) in its fourth quarter 2023 investor letter:
“GEN Restaurant Group, Inc. (NASDAQ:GENK) was the strategy’s greatest detractor. The company owns GEN Korean BBQ, a fast-growing experiential restaurant chain operating in seven states of the U.S. GENK offers customers a unique dining experience where they serve as their own chefs, preparing meals on embedded grills in the center of each table. The extensive menu consists of traditional Korean and Korean-American food, including high-quality meats, seafood and mixed vegetables. We bought GENK as an initial public offering (IPO). Afterward, we purchased additional shares on the open market. During the year prior to the IPO, we met with the management team and visited the restaurants several times—and our qualitative assessment was extremely positive. In terms of our quantitative assessment, we were impressed with GENK’s contribution margins in the vicinity of 20% and its EV-to-EBITDA valuation, which was below high-quality peers in the restaurant business. For the most part, the company’s fundamentals have progressed in line with our initial expectations. And every one of GENK’s 36 locations generates positive cash flow. But small operational improvements are needed in seven locations. Unfortunately, investors are inherently impatient with a newly public company that isn’t firing on all cylinders. While we’re disappointed that GENK stumbled in the aftermath of its IPO, we remain comfortable investing alongside company insiders, who still own 87% of the outstanding shares.”
A busy Korean barbecue restaurant, full of customers experiencing the traditional flavors.
GEN Restaurant Group, Inc. (NASDAQ:GENK) is not on our list of 30 Most Popular Stocks Among Hedge Funds. At the end of the fourth quarter, GEN Restaurant Group, Inc. (NASDAQ:GENK) was held by 10 hedge fund portfolios, compared to 8 in the previous quarter, according to our database.
We discussed GEN Restaurant Group, Inc. (NASDAQ:GENK) in another article and shared Wasatch Micro Cap Value Strategy’s views on the company. In addition, please check out our hedge fund investor letters Q4 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.
