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 Research Solutions, Inc. (NASDAQ:RSSS) and discussed its stance on the firm. Founded in 2006, Research Solutions, Inc. (NASDAQ:RSSS) is a Henderson, Nevada-based IT service management company with a $63.4 million market capitalization, and is currently spearheaded by its CEO, Roy Olivier. Research Solutions, Inc. (NASDAQ:RSSS) delivered a -4.88% return since the beginning of the year, while its 12-month returns are up by 8.84%. The stock closed at $2.34 per share on March 18, 2022.
Here is what Artko Capital has to say about Research Solutions, Inc. (NASDAQ:RSSS) in its Q4 2021 investor letter:
“Research Solutions (RSSS) – 11% of Portfolio; $1.80 cost basis/$2.20 current price
Our investment in Research Solutions, originally at sub $1.00 in 2017, though with substantial additions over the years our cost basis has drifted higher, is another frustrating example of the stock price moving in the opposite direction of fundamentals. As a reminder, Research Solutions is in the business of providing access to a wide range of academic white papers, of which there are over 70mm in the world and growing, through its Transactions segment to corporate and academic customers. This is not a “sexy” business but a mostly steady ~$26mm revenue/$6mm gross margin business that has remained flat since our original investment.
The main reason we got into this investment is because of its Platforms segment, a product that allows
the user to aggregate all the relevant information in a manageable snapshot. In other words, it is the Bloomberg terminal/CoStar seat/LexusNexus subscription but for the scientific community. This segment has grown at a 30%+ CAGR since we have invested in the company, from sub 50 platform deployments to ~650 in the most recent reported quarter, with a $6.8mm Annual Recurring Revenue (ARR) base at almost a 100% renewal rate. This is a segment that produces mid 80s gross margins and we expect to continue to drive growth for the company for the foreseeable future…” (Click here to see the full text)
Our calculations show that Research Solutions, Inc. (NASDAQ:RSSS) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. Research Solutions, Inc. (NASDAQ:RSSS) was in 3 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 4 funds in the previous quarter. Research Solutions, Inc. (NASDAQ:RSSS) delivered a 4.00% return in the past 3 months.
In November 2021, we also shared another hedge fund’s views on Research Solutions, Inc. (NASDAQ:RSSS) in another article. 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.
