Is it Better to Get Rid of Your Bentley Systems (BSY) Position?

Headwaters Capital, an investment management firm, published its third-quarter 2021 investor letter – a copy of which can be downloaded here. A quarterly portfolio net return of 4.5% was recorded by the fund for the fourth quarter of 2021, underperforming the Russell Mid Cap Index that delivered a +6.4% return 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.

Headwaters Capital, in its Q4 2021 investor letter, mentioned Bentley Systems, Incorporated (NASDAQ: BSY) and discussed its stance on the firm. Founded in 1984, Bentley Systems, Incorporated is an Exton, Pennsylvania-based infrastructure engineering software company with a $10.3 billion market capitalization, and is currently spearheaded by its CEO, Greg Bentley. BSY delivered a -24.60% return since the beginning of the year, while its 12-month returns are down by -22.19%. The stock closed at $36.44 per share on March 11, 2022.

Here is what Headwaters Capital has to say about Bentley Systems, Incorporated in its Q4 2021 investor letter:

“Top Detractor: Bentley Systems (“BSY”) -20%. Bentley, which was the top performer in Q2 ’21, sold off in conjunction with the broader sell-off in high growth and high multiple software names. Unlike some of the other software names that declined during the quarter, BSY has a history of generating strong free cash flow, has a strong competitive moat around its software and has good visibility into both near-term and long-term revenue growth. More specific to BSY, the company announced an acquisition of a smaller company for a lofty multiple, which also pressured the stock.”

Our calculations show that Bentley Systems, Incorporated (NASDAQ: BSY) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. BSY was in 13 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 18 funds in the previous quarter. Bentley Systems, Incorporated (NASDAQ: BSY) delivered a -23.02% return in the past 3 months.

In January 2022, we also shared another hedge fund’s views on BSY 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.