TMR Investments, an investment management company, released its fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. The firm concentrates on SMID cap value-oriented special situations and technology investments. The firm anticipates further dispersion in the tech industry, particularly as the AI cycle develops. Its long/short strategy and capacity to capitalize on disruptions are best suited to the current market conditions. TMR’s Long Short Opportunities, LP, returned 15.7% (net) in 2024 compared to 11.7% for the Russell 2000 Index and 9.1% for the Eureka Long Short HF Index. TMR’s Partners Long Only, LP, returned 25.3% (net) compared to 11.7% and 9.1% for Indexes. In addition, please check the fund’s top five holdings to know its best picks in 2024.
In its fourth quarter 2024 investor letter, TMR Investments emphasized stocks such as Zenvia Inc. (NASDAQ:ZENV). Zenvia Inc. (NASDAQ:ZENV) engages in the development of a cloud-based platform that enables organizations to integrate several communication capabilities. The one-month return Zenvia Inc. (NASDAQ:ZENV) was -29.91%, and its shares lost 30.23% of their value over the last 52 weeks. On March 21, 2025, Zenvia Inc. (NASDAQ:ZENV) stock closed at $1.50 per share with a market capitalization of $77.802 million.
TMR Investments stated the following regarding Zenvia Inc. (NASDAQ:ZENV) in its Q4 2024 investor letter:
“Zenvia Inc. (NASDAQ:ZENV has announced a strategic refocus along with the potential for an opportunistic divestment of non core assets to optimize their capital structure. Zenvia Customer Cloud (ZCC) was officially launched in October 2024 and will become Zenvia’s core business moving forward. ZCC is powered by AI-driven solutions and robust data analytics and is designed to adapt similarly to business of all sizes and across diverse industries. Clients already using it report enhanced customer engagement, increased sales, and reduced costs. Zenvia’s business will further shift to a volume-based pricing model, where clients pay based on the number of interactions they have with their clients and prospects rather than the traditional per-seat SaaS model. This approach is enabled by the extensive use of AI in their software, which minimizes the reliance of human agents, enhances efficiency for clients, and unlocks greater revenue generation potential with much less complexity. The ZCC customer base is a mix of existing clients who transitioned and new customers. ZCC is expected to grow revenue 30% in 2025 with 70% gross margins and positive EBITDA. Anything in the SaaS and CPaaS business that is not ZCC is counted as non-core and may be divested in the near future.
Valuation multiples have been expanding in CPaaS and SaaS. Twilio, Zenvia’s closest comparable in CPaaS, has seen its stock triple in the past three month and now trades at 3.4x NTM Revenue vs. Zenvia at 0.7x NTM Revenue. SaaS comparables such as CRM (7.3x Revenue), NOW (14.2x Revenue), and HUBS (12.2x Revenue) have also seen their multiples expand. Therefore, we are excited at the potential divestiture. We have encouraged Zenvia to pursue a sale/carve out as a way to force the market to rerate the stock should they sell part of their business at a valuation multiple closer to peers.”
A person using a laptop with a blue background showing the software platform’s user inteface.
Zenvia Inc. (NASDAQ:ZENV) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 3 hedge fund portfolios held Zenvia Inc. (NASDAQ:ZENV) at the end of the fourth quarter which was 3 in the previous quarter. While we acknowledge the potential of Zenvia Inc. (NASDAQ:ZENV) 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 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.