Should You Still Consider Investing in Photronics (PLAB)?

Heartland Advisors, an investment management firm, published its “Heartland Value Fund” fourth-quarter 2021 investor letter – a copy of which can be seen here. The fund continues to focus its relentless research on identifying and owning companies that are poised to succeed against a variety of backdrops or those that are priced at significant discounts to peers regardless of the sector. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.

Heartland Value Fund, in its Q4 2021 investor letter, Photronics, Inc. (NASDAQ: PLAB) mentioned and discussed its stance on the firm. Photronics, Inc. is a Brookfield, Connecticut-based semiconductor manufacturing company with a $1.0 billion market capitalization. PLAB delivered a -8.01% return since the beginning of the year, while its 12-month returns are up by 56.22%. The stock closed at $17.34 per share on January 27, 2022.

Here is what Heartland Value Fund has to say about Photronics, Inc. in its Q4 2021 investor letter:

“Information Technology (IT) had a strong showing for the period, and the portfolio reaped rewards from some long-time holdings, including Photronics Inc. (PLAB).

Photronics is an industry leading, global manufacturer of photomasks used to transfer circuit patterns onto semiconductor wafers and flat panel displays. During the past year, the company has met the challenge of heightened demand despite facing supply-chain bottlenecks.

Investments made a few years ago to spur growth are beginning to produce results with dramatic improvement on return on equity (ROE)—which we expect to reach 9% this coming year. Despite the strong growth, shares trade at just 1.2X book value and 13X next year’s estimated earnings.

Shares are up handsomely since we initially took a stake in the business, and we’ve taken some profits to redeploy elsewhere.”

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Our calculations show that Photronics, Inc. (NASDAQ: PLAB) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. PLAB was in 17 hedge fund portfolios at the end of the third quarter of 2021, compared to 15 funds in the previous quarter. Photronics, Inc. (NASDAQ: PLAB) delivered a 33.49% return in the past 3 months.

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.