Investment management company Cove Street Capital recently released its “Small Cap Value Fund” first quarter 2024 investor letter. A copy of the same can be downloaded here. In the first quarter, the fund returned 1.61% compared to 5.18% for the Russell 2000 Index and 2.90% for the Russell 2000 Value Index. The first quarter of calendar year 2024 was mostly more of the recent same. US investors focused on the Federal Reserve’s comments and still expecting interest rate cuts in 2024. In addition, you can check the top 5 holdings of the fund to know its best picks in 2024.
Cove Street Small Cap Value Fund featured stocks like Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) in the first quarter 2024 investor letter. Headquartered in Houston, Texas, Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) is a dredging services provider. On April 10, 2024, Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) stock closed at $8.08 per share. One-month return of Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) was -6.37%, and its shares gained 43.52% of their value over the last 52 weeks. Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) has a market capitalization of $538.315 million.
Cove Street Small Cap Value Fund stated the following regarding Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) in its first quarter 2024 investor letter:
“We made some sales during during the quarter as well. At the beginning of 2023, we initiated a position in Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) in the midst of a significant decline in the company’s results. Facilitated by the U.S. government, the “bid market” of projects for which GLDD competes evaporated in the first half of 2022 due to some combination of an extra-long Continuing Resolution, overly complicated budget authorization and allocation processes, and frankly, work-from-home inefficiencies. When your dredgers aren’t at work because you didn’t get your bid, you send them to the shipyard for maintenance, causing a “double-whammy” of less revenue and higher costs. GLDD’s margins in 2022 got crushed, as did the stock price. The bid market returned in late 2023, and GLDD’s backlog rebounded from $452m around the time of investment to $1.04B in early 2024, leading to a commensurate rise in the stock.
Concurrent with the return of Great Lakes’ core business to normalized conditions, GLDD has begun construction of a “wind vessel” with the purposes of facilitating the building of offshore wind farms on the East Coast of the United States beginning in late 2025. Given the myriad of headwinds facing these projects, this wind ship will be delivered into a highly uncertain demand environment for its use. We happily exited with the gains from our underwritten “bid market reversion” and before “wind” plays out.”
A view from an aerial drone showing the progress of an extensive coastal restoration project.
Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) is not on our list of 30 Most Popular Stocks Among Hedge Funds. At the end of the fourth quarter, Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) was held by 15 hedge fund portfolios, compared to 16 in the previous quarter, according to our database. In addition, please check out our hedge fund investor letters Q1 2024 page for more investor letters from hedge funds and other leading investors.
Suggested Articles:
- 16 Best Materials Stocks To Buy in 2024
- 20 Countries with the Largest Slum Population in the World
- 15 Best Places to Retire in Michigan
Disclosure: None. This article is originally published at Insider Monkey.
