Longleaf Partners, managed by Southeastern Asset Management, released its “Small-Cap Fund” fourth quarter 2024 investor letter. A copy of the letter can be downloaded here. The fund returned -1.58% in the fourth quarter, compared to the Russell 3000’s 2.63% return. For the year, the fund returned 9.69% compared to 23.81% return for the benchmark. For more information on the fund’s best picks in 2024, please check its top five holdings.
In its fourth quarter 2024 investor letter, Longleaf Partners Small-Cap Fund emphasized stocks such as Westrock Coffee Company, LLC (NASDAQ:WEST). Headquartered in Little Rock, Arkansas, Westrock Coffee Company, LLC (NASDAQ:WEST) is an integrated provider of coffee, tea, flavors, extracts, and ingredients solutions. The one-month return of Westrock Coffee Company (NASDAQ:WEST) was -1.40%, and its shares lost 33.16% of their value over the last 52 weeks. On March 4, 2025, Westrock Coffee Company (NASDAQ:WEST) stock closed at $6.33 per share with a market capitalization of $596.2 million.
Longleaf Partners Small-Cap Fund stated the following regarding Westrock Coffee Company (NASDAQ:WEST) in its Q4 2024 investor letter:
“Westrock Coffee Company (NASDAQ:WEST) – The coffee “brand behind the brand” for a variety of retailers and restaurants, Westrock was a top detractor for the year. The company reported disappointing results that led to its second straight year of missing guidance. Muted near term cash flow has led to more leverage than is optimal when compared to this depressed cash flow. Some of the factors driving results are macro (coffee has faced various headwinds, as seen at industry bellwether Starbucks this year), some are Westrock-specific operational challenges and still others are decisions that take short term pain in exchange for long-term gain (idling lines at the company’s key plant in order to clear space for new customers). Despite these near-term pressures, Westrock remains focused on ramping up its new facility in Conway, Arkansas – a pivotal development for the company’s financial position. FCF generation is expected to begin in 2025 before accelerating substantially in 2026 and beyond. While the market adopts a cautious “wait-and-see” stance, 2025 will be an important year for execution.”
A team of baristas in the roasting area with sacks of freshly roasted coffee beans.
Westrock Coffee Company (NASDAQ:WEST) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 5 hedge fund portfolios held Westrock Coffee Company (NASDAQ:WEST) at the end of the fourth quarter which was 6 in the previous quarter. While we acknowledge the potential of Westrock Coffee Company (NASDAQ:WEST) 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 Westrock Coffee Company (NASDAQ:WEST) and shared the list of best coffee stocks to buy according to hedge funds. Westrock Coffee Company (NASDAQ:WEST) was Longleaf Partners Small-Cap Fund’s top detractor in the last 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.