Investment management company Laughing Water Capital released its second quarter investor letter 2022, a copy of the same can be downloaded here. In the second quarter, the fund returned -19.4%, which brings the year-to-date return to -29.5%. The letter discussed the reasons for the underperformance of its portfolios. S&P 500 & Russell 2000 also underperformed in the second quarter and returned -16.1% and -17.2%, respectively. You can check the top 5 holdings of the fund to see its best picks in 2022.
In the Q2 2022 investor letter, Laughing Water Capital analyzed the current events in the market and pointed out how they affected its portfolios. The fund discussed the stocks like Thryv Holdings, Inc. (NASDAQ:THRY). Thryv Holdings, Inc. (NASDAQ:THRY) is a software service company based in DFW Airport, Texas has a market capitalization of $833.368 million. The stock of Thryv Holdings, Inc. (NASDAQ:THRY) closed at $24.34 per share on July 29, 2022. Thryv Holdings, Inc. (NASDAQ:THRY) had a return of 6.90% for the past month, and its 12-month return dropped to -27.13%.
Here is what Laughing Water Capital specifically said about Thryv Holdings, Inc. (NASDAQ:THRY):
“Thryv Holdings, Inc. (NASDAQ:THRY) is our small business software company that is milking the cash flows from the legacy yellow pages business. Shares have sold off perhaps because all things SAAS have been punished, and perhaps because this business has exposure to small and medium businesses, which will presumably be challenged in a recessionary environment. At the same time, I do not think the trend of small businesses moving to the cloud is at risk, and Thryv’s product replaces labor by automating many tasks, and thus likely actually saves its customer’s money which may accelerate adoption in a recessionary environment. Most importantly however, Thryv’s software business is fully scaled, and was previously cash flowing before management elected to increase growth spending. In a more challenged economic environment, management could simply flip the switch back to focus on cash flow. The team here is excellent, having navigated through many challenging economic cycles over the last 30 years, they have a lot of skin in the game, and they understand that at the end of the day cash flow is king. Earlier this year they laid out a plan to ~5x the business over the next 5 years, and then 4x the business in the 5 years after that. These are clearly ambitious plans, but given the undemanding valuation, they could fall well short and we would still be rewarded. It is worth noting that they did not suggest that this growth would come in a straight line, and I would be shocked if they did not plan for many speedbumps along the way.”
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Even though Laughing Water Capital invested in Thryv Holdings, Inc. (NASDAQ:THRY), the stock is not on our list of 30 Most Popular Stocks Among Hedge Funds. Thryv Holdings, Inc. (NASDAQ:THRY) was in 20 hedge fund portfolios at the end of the first quarter of 2022, which was up from 13 in the previous quarter. Thryv Holdings, Inc. (NASDAQ:THRY) shares lost 8.67% of their value over the last 3 months.
You can check another article on Thryv Holdings, Inc. (NASDAQ:THRY), released in April. In addition, please check out our hedge fund investor letters Q2 2022 page for more investor letters from hedge funds and other leading investors.
Disclosure: None. This article is originally published at Insider Monkey.
