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 Northern Technologies International Corporation (NASDAQ:NTIC) and discussed its stance on the firm. Founded in 1970, Northern Technologies International Corporation (NASDAQ:NTIC) is a Circle Pines, Minnesota-based packaging and containers company with a $120.4 million market capitalization, and is currently spearheaded by its CEO, Patrick Lynch. Northern Technologies International Corporation (NASDAQ:NTIC) delivered a -16.34% return since the beginning of the year, while its 12-month returns are down by -20.05%. The stock closed at $12.80 per share on March 18, 2022.
Here is what Artko Capital has to say about Northern Technologies International Corporation (NASDAQ:NTIC) in its Q4 2021 investor letter:
“Northern Technologies (NTIC) – 8% of Portfolio; $8.80 cost basis/$13.00 current price
Northern Technologies has been another wild ride for us in 2021, returning close to 40%, though down 35% from its 2021 peak, participating in the aforementioned small cap market pullback in the second half of 2021. As a reminder this $120mm market ($100mm Enterprise Value) chemical producer has two flagship chemical products which it sells in 60 countries globally: ZERUST, which is a corrosion inhibitor for a wide variety of industrial segments including automotive and energy; and Natur-Tec which is marketleading compostable bioplastics compound. The company has a repeatable consumables-based business model, a strong balance sheet with $20mm in company/joint venture cash, and $50mm combined net working capital, and an incentivized management team with insiders owning 16% of the company.
In a somewhat similar business model to HireQuest, what attracted us to NTIC was its franchise-like Joint Venture structure, with 18 international JVs, which collect 7% of the revenues and 50% of the dividends which average out to be approximately 11% of the JVs revenues. Due to accounting treatments of JVs and their significant size to the company’s overall business model, the accounting treatment tendsto misstate the overall profitability of the company on a margin basis and usually requires adjustments to understand the true economic earning power of its business.”
Marcin Balcerzak/Shutterstock.com
Our calculations show that Northern Technologies International Corporation (NASDAQ:NTIC) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. Northern Technologies International Corporation (NASDAQ:NTIC) was in 4 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 5 funds in the previous quarter. Northern Technologies International Corporation (NASDAQ:NTIC) delivered a -8.44% return in the past 3 months.
In February 2021, we also shared another hedge fund’s views on Northern Technologies International Corporation (NASDAQ:NTIC) 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.
