Greenhaven Road Capital, an investment management firm, published its second-quarter 2022 investor letter – a copy of which can be downloaded here. The Fund returned about -33% in the second quarter, bringing its total decline to approximately -51% in the first half of the year. This has been the U.S. market’s worst start to a year in over a half-century and, unfortunately, the fund’s losses were quite outsized during the period, largely due to its concentrated, long-term bets in growth areas. Go over the fund’s top 5 positions to have a glimpse of its finest picks for 2022.
In its Q2 2022 investor letter, Greeenhaven Road Capital mentioned PAR Technology Corporation (NYSE:PAR) and explained its insights for the company. Founded in 1968, PAR Technology Corporation (NYSE:PAR) is a New Hartford, New York-based systems and service solutions provider with a $965.7 million market capitalization. PAR Technology Corporation (NYSE:PAR) delivered a -34.91% return since the beginning of the year, while its 12-month returns are down by -38.67%. The stock closed at $34.35 per share on September 13, 2022.
Here is what Greeenhaven Road Capital has to say about PAR Technology Corporation (NYSE:PAR) in its Q2 2022 investor letter:
“Our largest holding is PAR Technology (NYSE:PAR), which provides technology to quick service restaurants (QSRs). QSRs typically do quite well in a recession as consumers “trade down” to less expensive offerings. At a June conference held by small and micro cap broker Sidoti, CEO Savneet Singh referenced the underlying strength of their customer base when he said that their restaurant customers had just had their best week ever as measured by revenue recorded on the POS system. Restaurant owners are forced buyers of their POS system, and PAR’s core POS business is stable and well-positioned even during a recession. Not immune, but well-positioned.
There are three other developments at PAR that provide sources of optimism, despite what the declining share price and compressing multiple might otherwise indicate. The first is the success of their payments business, which launched less than a year ago. In approximate numbers, locations that adopt the solution increase PAR’s revenue per location by 70% and nearly double PAR’s gross profit. At that same Sidoti conference, the CEO indicated that, if not for current supply chain obstacles tied to procuring third-party certified hardware (card scanners), the payments business would be doing $10M in revenue this year and growing. He said, “historically, I have been really conservative on this business but I have really turned to saying this is going way better than expected…. Way more pickup… if not for limitations on supply chain we would be jumping up and down as this would be blowing out projections.” If a payments customer wants to accept credit cards, PAR is contractually guaranteed to get paid with every single swipe or tap…” (Click here to see the full text)
Our calculations show that PAR Technology Corporation (NYSE:PAR) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. PAR Technology Corporation (NYSE:PAR) was in 19 hedge fund portfolios at the end of the second quarter of 2022, compared to 23 funds in the previous quarter. PAR Technology Corporation (NYSE:PAR) delivered a 2.60% return in the past 3 months.
In April 2022, we also shared another hedge fund’s views on PAR Technology Corporation (NYSE:PAR) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q2 page.
Disclosure: None. This article is originally published at Insider Monkey.
