Rhizome Partners, an investment management firm, published its fourth-quarter 2021 investor letter – a copy of which can be downloaded here. For the fourth quarter of 2021, Rhizome Partners generated a net gain of 6.7% versus an 11.0% gain for the Standard & Poor’s 500 Index and a 16.2% gain for the National Association of Real Estate Investment Trusts (NAREIT) Index. For the year, Rhizome Partners Class B returned 24.9% versus 28.7% for the S&P 500 and 41.3% for the NAREIT. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.
Rhizome Partners, in its Q4 2021 investor letter, mentioned FRP Holdings, Inc. (NASDAQ: FRPH) and discussed its stance on the firm. FRP Holdings, Inc. is a Jacksonville, Florida-based holding company with a $532.9 million market capitalization. FRPH delivered a -2.02% return since the beginning of the year, while its 12-month returns are up by 19.30%. The stock closed at $56.63 per share on February 23, 2022.
Here is what Rhizome Partners has to say about FRP Holdings, Inc. in its Q4 2021 investor letter:
“We believe that the forward returns of most of the active investments are greater than 15% annualized. This should increase the MOIC multiple going forward. Our MOIC multiples have also been reduced as a result of our risk-management efforts. For example, FRP Holdings exceeded 30% of the portfolio when it appreciated from lows 30s to mid-40s during the period from late 2016 to the middle of 2017. We sold shares to reduce the position concentration, which had the unintended effect of reducing MOIC multiples. We encourage you to audit our track record. We’ve created detailed standalone investment presentations and provided deep-dive analysis of these positions in our investor letters.
We believe our unique results came from diligent underwriting and buying at large discounts to private market value. These companies are backed by good real estate assets experiencing positive trends. In addition to share-price appreciation, intrinsic value was validated by private transactions, such as CubeSmart buying Laacos and Blackstone buying FRP Holdings’ warehouse portfolio. JW Mays is the only company trading below our exit price, which is due to management quality. A sale of the company, however, could result in proceeds that are multiples of our exit price. This is in deep
contrast to the recent meltdown of SPACs and some overly priced growth companies. The gains experienced by speculation were temporary…” (Click here to see the full text)
Investments, Finance
Our calculations show that FRP Holdings, Inc. (NASDAQ: FRPH) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. FRPH was in 5 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 7 funds in the previous quarter. FRP Holdings, Inc. (NASDAQ: FRPH) delivered a -8.07% return in the past 3 months.
In February 2022, we also shared another hedge fund’s views on FRPH 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.
