Artko Capital, an asset management firm, published its fourth-quarter 2021 investor letter – a copy of which can be downloaded here. For the fourth calendar quarter of 2021, an average partnership interest in Artko Capital LP was down 3.4% net of fees. At the same time, investments in the most comparable market indexes—Russell 2000, Russell Microcap, and the S&P 500—were up 2.1%, down 2.7%, and up 8.6%, respectively. For the calendar year of 2021, an average partnership interest in Artko Capital LP was up 19.4% net of fees. At the same time, investments in the aforementioned market indexes were up 14.8%, 19.3%, and 28.7%, respectively. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.
Artko Capital, in its Q4 2021 investor letter, mentioned HireQuest, Inc. (NASDAQ:HQI) and discussed its stance on the firm. Founded in 2011, HireQuest, Inc. (NASDAQ:HQI) is a South Carolina-based temporary staffing offices franchisor with a $256.1 million market capitalization and is currently spearheaded by its CEO, Richard F. Hermanns. HireQuest, Inc. (NASDAQ:HQI) delivered a -7.29% return since the beginning of the year, while its 12-month returns are up by 11.78%. The stock closed at $18.69 per share on March 18, 2022.
Here is what Artko Capital has to say about HireQuest, Inc. (NASDAQ:HQI) in its Q4 2021 investor letter:
“HireQuest (HQI) – 18.5% of Portfolio; $5.50 cost basis/$19.00 current price
We have discussed our investment in HireQuest substantially in the past letters, however, our excitement over this opportunity does not seem to abate. We cannot think of being better positioned from a
macroeconomic perspective, than being invested in an experienced staffing franchisor when the United States is experiencing some of the tightest labor markets seen historically, with the labor force participation at ~62% (vs a more normalized 64%), an unemployment rate of 4%, and 2021 wage inflation of close to 5%, which we do not anticipate to abate in the near term.We love simple business models, with strong balance sheets, large opportunity sets, and incentivized managements with HQI fitting all those checkboxes. The model is simple: buy (or open organically) a staffing branch, turn it into a franchise location (for a fee) and turn, the formerly an employee, branch manager into an entrepreneur/owner with substantial incentives to grow revenues from which HQI collects 6% to 8% (6.2% for first nine months of 2021), on a relatively fixed cost base. The branch managers, likely for the first time in their lives, have an opportunity to earn six-figure salaries, while HQI provides a trusted brand name, legal and operational support, and more importantly, cheap, due to volume, workman’s compensation insurance, are ecstatic…” (Click here to see the full text)
Our calculations show that HireQuest, Inc. (NASDAQ:HQI) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. HireQuest, Inc. (NASDAQ:HQI) was in 1 hedge fund portfolio at the end of the fourth quarter of 2021, compared to 2 funds in the previous quarter. HireQuest, Inc. (NASDAQ:HQI) delivered a -6.97% return in the past 3 months. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.
Disclosure: None. This article is originally published at Insider Monkey.
