Long Cast Advisers, LLC, a small-cap-focused investment manager, released its second quarter 2023 investor letter. A copy of the same can be downloaded here. The cumulative net returns of the fund for Q2 2023 were flat and year-to-date the fund’s return was 11%. The fund has returned a cumulative 166% net of fees, or 14% CAGR since inception in November 2015 through quarter end 2Q23. In addition, please check the fund’s top five holdings to know its best picks in 2023.
Long Cast Advisers highlighted stocks like CoreCard Corporation (NYSE:CCRD) in the second quarter 2023 investor letter. Headquartered in Norcross, Georgia, CoreCard Corporation (NYSE:CCRD) provides technology solutions and processing services. On September 25, 2023, CoreCard Corporation (NYSE:CCRD) stock closed at $20.90 per share. One-month return of CoreCard Corporation (NYSE:CCRD) was -5.69%, and its shares lost 2.79% of their value over the last 52 weeks. CoreCard Corporation (NYSE:CCRD) has a market capitalization of $177.455 million.
Long Cast Advisers made the following comment about CoreCard Corporation (NYSE:CCRD) in its Q2 2023 investor letter:
“CoreCard Corporation (NYSE:CCRD). On the 2Q23 conf call, the CEO described a malaise hanging over the market, with banks cautiously spending due to rising rates and a risk averse post SVB environment. Obviously, this is not a great near-term outlook for a company that sells credit card issuing software to banks.
Noise around the Goldman relationship and the Apple Card overshadows the stock, but I think the right way to understand the company is ex-Goldman, which may sound weird since Goldman is 70% of sales, but it is a locked in customer through the Apple Card relationship – even if Goldman sells the portfolio to another bank or provider, CoreCard would remain the ledger of record – so the company’s ability to find the next customer matters to me most.
Growth is slowing off difficult comps (+60% last year) but small business tends to be lumpy and cyclical. The 2Q earnings call highlighted multiple implementations expected to “go live” in the coming months with the added caveat: “… we’re doing a lot of new stuff. We still have new clients coming in. We’re just not getting to market as fast as we would hope they’d get to market.” I wonder as a point of criticism if it’s worth revisiting management’s long term under investment in sales and marketing.
Overall, I view this as a “high IQ,” high FCF company with multiple opportunities to reinvest at high rates of return. Given its history, the industry, the customer base, the typical acquisition multiples (I think this eventually gets acquired), this continues to fits our “five year double” potential.”
CoreCard Corporation (NYSE:CCRD) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 8 hedge fund portfolios held CoreCard Corporation (NYSE:CCRD) at the end of second quarter which was 6 in the previous quarter.
We discussed CoreCard Corporation (NYSE:CCRD) in another article and shared Weitz Partners III Opportunity Fund’s views on the company. In addition, please check out our hedge fund investor letters Q2 2023 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.
