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 PAR Technology (NYSE:PAR) 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.
An engineer working in a tech lab, surrounded by tools and components.
PAR Technology (NYSE:PAR)
Value of Voss Capital’s 13F Position (6/30/2024): $71.4 million
PAR Technology (NYSE:PAR) markets cloud-based hardware and software products to restaurants and retailers. Among its offerings are an e-commerce platform and a point-of-sale product.
In the 12 months that ended in September 2024, its revenue came in at $454 million, versus $304.5 million in the 12 months that ended in September 2023. However, in Q3, its net loss rose to $20.7 million versus a net loss of $19.2 million in the same period of 2023. But its top line did jump 41% year-over-year last quarter to $96.8 million, while its organic annual recurring revenue rose about 25% year-over-year. Also noteworthy is that its adjusted EBITDA rose to $2.4 million in Q3 versus an adjusted EBITDA loss of $6.56 million in Q3 of 2023.
Analysts, on average, expect PAR Technology (NYSE:PAR) to generate earnings per share of 16 cents in 2025, versus a per share loss of 77 cents this year.
Voss predicted that PAR Technology (NYSE:PAR) would benefit from very strong demand for technology by restaurants. Moreover, Voss predicted that PAR Technology (NYSE:PAR) would become profitable, pleasing the market. Other catalysts for PAR Technology (NYSE:PAR), according to Voss, include an acceleration of its ARR growth and its Investor Day which it had planned to hold in the Fall.
Since May 24, PAR Technology (NYSE:PAR) has jumped 57%.
Greenhaven Road Capital stated the following regarding PAR Technology Corporation (NYSE:PAR) in its Q3 2024 investor letter:
“PAR Technology Corporation (NYSE:PAR) – We have owned restaurant technology provider PAR for approximately five years and began buying when the share price was in the $20s. Major accomplishments over the past five years include: 1) Improving the POS (point-of-sale) code base to improve stability, which laid the foundation for growth. 2) Executing five acquisitions that expanded the addressable market, product lines, and provided scale 3) Winning Burger King and Wendy’s as customers. These Tier 1 wins have led to the biggest RFP pipeline in the company’s history. 4) Divestiture of government business to become more of a “pure play” enterprise software company. 5) Growing the ARR/Share from $1.04 to $5.30 (as of June 30, 2024) with line of sight to >$8. 6) Inflecting to profitability (while not yet reported, I think it happened in Q3 of this year). This is a vertical market software company with accelerating growth and inflecting to profitability. The markets are bigger, the products are better, the customers are larger, and team is deeper. The future is far brighter than when we invested 5 years ago.”
Overall, PAR ranks 2nd on our list of stocks billion dollar hedge fund Voss Capital is crazy about. While we acknowledge the potential of PAR, 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 PAR 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.
