Bonhoeffer Capital Management, an investment management firm, released its first quarter 2023 investor letter, a copy of which can be downloaded here. In its first quarter letter, the fund mentioned its main country exposures are South Korea, the United States, the United Kingdom, South Africa, the Philippines, and Latin America. Notably, the fund has significant industry exposures in telecom/media, real estate/infrastructure, and consumer products. The fund is targeting sectors within the chemicals, leasing, distributors, housing, and specialty finance sectors. Spare some time to check the fund’s top 5 holdings to know more about their top bets for 2023.
In its Q1 2023 investor letter, Bonhoeffer Capital Management mentioned Consolidated Communications Holdings Inc. (NASDAQ:CNSL) and explained its insights for the company. Founded in 2002, Consolidated Communications Holdings Inc. (NASDAQ:CNSL) is a Mattoon, Illinois-based telecommunications company with a $412.9 million market capitalization. Consolidated Communications Holdings Inc. (NASDAQ:CNSL) delivered a -1.12% return since the beginning of the year, while its 12-month returns are down by -52.80%. The stock closed at $3.54 per share on June 23, 2023.
Here is what Bonhoeffer Capital Management has to say about Consolidated Communications Holdings Inc. (NASDAQ:CNSL) in its Q1 2023 investor letter:
“Consolidated Communications (NASDAQ:CNSL) is a broadband communications provider who is rolling out a fiberoptic network described in detail in previous letters. Recently, CNSL received a buyout proposal from Searchlight, the private equity firm who funded the fiberoptic rollout to date. The offer was for $4/share. We believe this vastly undervalues CNSL. For example, using an exit multiple of 11x EBITDA (about 50% of current fiberoptic transition multiples) and the projected 2027 EBITDA based upon management’s current plan results in a value of $35/share. If an 8.5x EBITDA multiple (the current depressed multiple for broadband providers) is applied to the projected 2027 EBITDA, the result is $20/share. As a result, we sent a letter to CNSL’s special committee describing our valuation and proposing other options they might consider to secure the additional funding to ensure the fiberoptic network can be rolled out. We received an acknowledgement of receipt, but that is the extent of the feedback for shareholders who sent letters to the special committee.”
Photo by Mika Baumeister on Unsplash
Our calculations show that Consolidated Communications Holdings Inc. (NASDAQ:CNSL) was not able to secure a spot on our list of the 30 Most Popular Stocks Among Hedge Funds. Consolidated Communications Holdings Inc. (NASDAQ:CNSL) was in 14 hedge fund portfolios at the end of the first quarter of 2023, compared to 12 funds in the previous quarter. Consolidated Communications Holdings Inc. (NASDAQ:CNSL) delivered a 64.65% return in the past 3 months. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters Q1 2023 page.
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Disclosure: None. This article is originally published at Insider Monkey.
