Palm Valley Capital Management, an investment management firm, released the “Palm Valley Capital Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, Palm Valley Capital Fund appreciated 0.57% compared to an 8.93% decline in the S&P SmallCap 600 and a 6.08% drop in the Morningstar Small Cap Total Return Index. Cash was 77.6% of Fund assets at the start of the quarter and 76.5% at the conclusion. In addition, please check the fund’s top five holdings to know its best picks in 2025.
In its first quarter 2025 investor letter, Palm Valley Capital Fund emphasized stocks such as Reynolds Consumer Products Inc. (NASDAQ:REYN). Reynolds Consumer Products Inc. (NASDAQ:REYN) engages in the production and distribution of products in cooking, waste and storage, and tableware product categories. The one-month return of Reynolds Consumer Products Inc. (NASDAQ:REYN) was -6.50%, and its shares lost 18.58% of their value over the last 52 weeks. On April 4, 2025, Reynolds Consumer Products Inc. (NASDAQ:REYN) stock closed at $23.93 per share with a market capitalization of $4.85 billion.
Palm Valley Capital Fund stated the following regarding Reynolds Consumer Products Inc. (NASDAQ:REYN) in its Q1 2025 investor letter:
“We started four new positions in the first quarter: Forrester Research (ticker: FORR), Monro (ticker: MNRO), Reynolds Consumer Products Inc. (NASDAQ:REYN, and Flowers Foods (ticker: FLO). Each of these is a relatively small weighting in the Fund. Reynolds Consumer Products owns the iconic Reynolds Wrap and Hefty brands. Its cooking, cleanup, and storage products are present in 95% of U.S. households and generally hold the #1 or #2 market share. Consistent demand leads to stable results, although raw materials costs create some volatility. We view Reynolds as a high quality business that rarely has traded for a reasonable valuation. Due to the business’s stability, it can accommodate leverage. We believe the company’s borrowings are very manageable in comparison to its cash flow. Like any authentic money manager, we eat our own cooking, and with a stake in Reynolds, stocking up on supplies for our tin foil hats serves a dual purpose!”
Rows of shelves stocked with containers for consumer goods, showing the broadness of the company’s selection.
eynolds Consumer Products Inc. (NASDAQ:REYN) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 23 hedge fund portfolios held Reynolds Consumer Products Inc. (NASDAQ:REYN) at the end of the fourth quarter compared to 21 in the third quarter. In the fiscal year 2024, Reynolds Consumer Products Inc. (NASDAQ:REYN) reported net revenues of $3.695 billion which exceeded its initial guidance. While we acknowledge the potential of Reynolds Consumer Products Inc. (NASDAQ:REYN) 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.
We covered Reynolds Consumer Products Inc. (NASDAQ:REYN) in another article, where we shared The London Company SMID Cap Strategy’s views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2025 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.