Is it a Smart Decision to Buy Wayfair (W) Shares?

Vulcan Value Partners, an investment management firm, published its fourth-quarter 2021 investor letter – a copy of which can be downloaded here. Vulcan’s Large Cap Composite Fund delivered a 1.2% net return for the fourth quarter of 2021, compared to its benchmarks, the Russell 1000 Value Index and S&P 500 Index which delivered 7.8% and 11% returns respectively for the same period. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.

Vulcan Value Partners, in its Q4 2021 investor letter, mentioned Wayfair Inc. (NYSE:W) and discussed its stance on the firm. Founded in 2002, Wayfair Inc. (NYSE:W) is a Boston, Massachusetts-based furniture e-commerce company with a $13.4 billion market capitalization, and is currently spearheaded by its CEO, Niraj Shah. Wayfair Inc. (NYSE:W) delivered a -32.81% return since the beginning of the year, while its 12-month returns are down by -60.93%. The stock closed at $127.65 per share on March 22, 2022.

Here is what Vulcan Value Partners has to say about Wayfair Inc. (NYSE:W) in its Q4 2021 investor letter:

“Wayfair is a company that invested heavily in building its competitive advantages but was losing money and had negative free cash flow. The pandemic accelerated the company’s transition to scale, and they are now leveraging those investments to strengthen their competitive advantages. Post-Covid, the company is profitable and generating free cash flow as the company has begun to reap the benefits of these investments during the pandemic.”

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Our calculations show that Wayfair Inc. (NYSE:W) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. Wayfair Inc. (NYSE:W) was in 28 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 31 funds in the previous quarter. Wayfair Inc. (NYSE:W) delivered a -37.36% return in the past 3 months.

In February 2022, we also shared another hedge fund’s views on Wayfair Inc. (NYSE:W) 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.