Middle Coast Investing Closed its Short Position in Kura Sushi (KRUS)

Middle Coast Investing, an investment advisor firm, released its fourth-quarter investor letter. A copy of the letter can be downloaded here. It was a strong quarter for the strategy which outperformed the S&P 500 and the Russell 2000. However, in full year 2024, the strategy beat the Russell 2000, the most relevant benchmark, but trailed the S&P 500, the most important benchmark. In addition, please check the fund’s top five holdings to know its best picks in 2024.

Middle Coast Investing highlighted stocks like Kura Sushi USA, Inc. (NASDAQ:KRUS) in the third quarter 2024 investor letter. Kura Sushi USA, Inc. (NASDAQ:KRUS) operates technology-enabled Japanese restaurants. The one-month return of Kura Sushi USA, Inc. (NASDAQ:KRUS) was -12.68%, and its shares lost 3.13% of their value over the last 52 weeks. On January 8, 2025, Kura Sushi USA, Inc. (NASDAQ:KRUS) stock closed at $90.09 per share with a market capitalization of $1.087 billion.

Middle Coast Investing stated the following regarding Kura Sushi USA, Inc. (NASDAQ:KRUS) in its Q4 2024 investor letter:

“I wrote up Portillo’s briefly in Q3, where I had executed a pair trade with Kura Sushi USA, Inc. (NASDAQ:KRUS), buying Portillo’s shares and selling Kura Sushi short. That trade worked on a short-term basis, and while I unsuccessfully shorted Kura again (see below), I also decided to open a Portillo’s position.

I mentioned KRUS above. We closed our short the second time around at $90, shortly after the company’s Q3 which I thought was quite bad but didn’t really hit the stock. There’s no obvious catalyst to correct the company’s value, and I am probably missing the bull case. I only short in personal accounts.”

A close-up of a sushi chef, displaying his care and attention to detail in making a dish.

Kura Sushi USA, Inc. (NASDAQ:KRUS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 14 hedge fund portfolios held Kura Sushi USA, Inc. (NASDAQ:KRUS) at the end of the third quarter which was 12 in the previous quarter. While we acknowledge the potential of Kura Sushi USA, Inc. (NASDAQ:KRUS) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

In another article, we discussed Kura Sushi USA, Inc. (NASDAQ:KRUS) and shared Middle Coast Investing’s views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q4 2024 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.