We recently published a list of 7 Stocks Billion Dollar Hedge Fund Voss Capital Is Crazy About. In this article, we are going to take a look at where Alta Equipment Group (NYSE:ALTG) stands against other stocks that Voss Capital is crazy about.
A fund management company, Voss Capital is based in Houston and was founded in 2011 by Travis Cocke who currently serves as the fund’s General Partner and Chief Investment Officer. He manages Voss’ funds. Interestingly, Voss is an acronym which stands for Value-Oriented Special Situations.
Before launching Voss, Cocke served as a Generalist Research Analyst at Ascendant Advisors LLC. from August 2009 to July 2010. Cocke was also an intern at the Teacher Retirement System of Texas during the summer of 2008.
He obtained a Bachelor of Business Administration in Finance from Texas A&M in 2009.
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In addition to concentrating on value stocks and special situations, as implied by the words that make up Voss’ acronym, the fund manager focuses on fundamentals. Special situations are unusual developments that affect companies. Additionally, Voss seeks to invest in stocks that it believes can double within three years.
Our Methodology
The following data is gathered from Voss Capital’s investment letter for the first quarter of 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here). That’s why you should pay close attention to this important indicator.
A warehouse manager inspecting a design and structure of a modern warehouse.
Alta Equipment Group (NYSE:ALTG)
Value of Voss Capital’s 13F Position (6/30/2024): $24 million
An owner of equipment dealerships that both sell and rent equipment, Alta Equipment Group (NYSE:ALTG) also builds warehouses and repairs and provides maintenance for equipment.
In the third quarter, Alta Equipment Group (NYSE:ALTG)’s revenue fell by 3.7% versus the same period a year earlier to $449 million. On a positive note, its product support revenue rose 8% year-over-year, but its new and used equipment sales sank 13.3% YOY. Moreover, it generated an adjusted loss per share of 72 cents, although its adjusted EBITDA did come in at $43.2 million.
CEO Ryan Greenawalt reported that a number of Alta Equipment Group (NYSE:ALTG)’s customers had elected to postpone projects in order to wait for the outcome of the U.S. elections. He expressed optimism that Alta Equipment Group (NYSE:ALTG)’s customers would deploy more capital in 2025.
Analysts, on average, expect Alta Equipment Group (NYSE:ALTG)’s revenue to rise slightly to $1.9 billion in 2025 from $1.87 billion in 20254, and the mean estimate calls for its per-share loss to drop to -24 cents in 2025 from -$1.16 in 2024.
In May, Voss had expected Alta Equipment Group (NYSE:ALTG)’s parts and services revenue sales growth to be “resilient.” That’s because Alta Equipment Group (NYSE:ALTG)’s sales of new equipment had increased at a compound annual growth rate (CAGR) of about 43% since 2019, according to the firm. Additionally, Voss predicted that Alta Equipment Group (NYSE:ALTG) ‘s margins would rise, partly due to more profitable items making up a higher proportion of its sales. According to Voss, Alta Equipment Group (NYSE:ALTG)’s valuation was extremely low.
Alta Equipment Group (NYSE:ALTG)’s shares have sunk 25% since May 24.
Overall, ALTG ranks 7th on our list of stocks billion dollar hedge fund Voss Capital is crazy about. While we acknowledge the potential of ALTG, our conviction lies in the belief that under the radar AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ALTG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
