Laughing Water Capital, an investment management company, released its third-quarter 2023 investor letter. A copy of the same can be downloaded here. In the third quarter, the fund fell approximately 11.6%, which makes YTD returns ~8.3% compared to the SP500TR and the R2000 returns of -3.3% and -5.1%, respectively, during the quarter and 13.1% and 2.5% YTD, respectively. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
Laughing Water Capital highlighted stocks like Lifecore Biomedical, Inc. (NASDAQ:LFCR) in the third quarter 2023 investor letter. Lifecore Biomedical, Inc. (NASDAQ:LFCR) is an integrated contract development and manufacturing organization headquartered in Chaska, Minnesota. On October 23, 2023, Lifecore Biomedical, Inc. (NASDAQ:LFCR) stock closed at $7.26 per share. One-month return of Lifecore Biomedical, Inc. (NASDAQ:LFCR) was -8.33%, and its shares lost 14.39% of their value over the last 52 weeks. Lifecore Biomedical, Inc. (NASDAQ:LFCR) has a market capitalization of $214.264 million.
Laughing Water Capital made the following comment about Lifecore Biomedical, Inc. (NASDAQ:LFCR) in its Q3 2023 investor letter:
“Lifecore Biomedical, Inc. (NASDAQ:LFCR) – Lifecore is our pharmaceutical fill/finish business that specializes in highly viscous materials, as well as prefilled syringes and vials. As you know from past letters, our investment here has taken quite a few twists and turns, and what was originally a longer duration story today exists as a special situation as the company is in the midst of a strategic review that I believe will likely result in a sale of the business. While shares are still up significantly from the company’s flirtation with bankruptcy earlier this year, more recently shares have traded down from their interim high, which has dragged on our recent performance.
The decline seems to be primarily related to the length of the sale process, with some observers believing it is dragging on to a point where a favorable outcome is less likely. The fact that the company has delayed the release of their 10K due to issues that are non-core to Lifecore’s operations does not help either. From my perspective, the length of the process is not concerning. Several bankers that have run these processes in the past have told me that 6 to 9 months would not be at all unusual, and we are just a bit past the 6 month mark from the unofficial start of the process. That being said, my upside cases of $20+ per share were tied to an ultra-competitive, fast process, so it seems less likely that the upside cases will come to fruition.
With delayed filings there is a near complete information vacuum at the moment, other than positive updates from Apellis Pharmaceuticals (APLS), who is a customer of Lifecore’s, and brief commentary from the company that they have continued to add new customers to their roster. I continue to think a sale of the company is the most likely outcome in the not-too-distant future.”
A doctor in a hospital conducting a clinical trial for a new biopharmaceutical drug. Editorial photo for a financial news article. 8k. –ar 16:9
Lifecore Biomedical, Inc. (NASDAQ:LFCR) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 15 hedge fund portfolios held Lifecore Biomedical, Inc. (NASDAQ:LFCR) at the end of second quarter which was 13 in the previous quarter.
We discussed Lifecore Biomedical, Inc. (NASDAQ:LFCR) in another article and shared Cove Street Small Cap Value Fund’s views on the company. In addition, please check out our hedge fund investor letters Q3 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.
