Bonhoeffer Capital Management, an asset management company, released its fourth-quarter investor letter. A copy of the same can be downloaded here. In the fourth quarter, the fund returned 13.3% net of fees, the MSCI World ex-US Index returned 14.9%, and DFA International Small Cap Value Fund returned 19.4% for the same period. For the full year 2022, the fund returned -20.5%, compared to -16.0% and -9.8% return respectively for the indexes. In addition, please check the fund’s top five holdings to know its best picks in 2022.
Bonhoeffer Capital Management highlighted stocks like Millicom International Cellular S.A. (NASDAQ:TIGO) in its Q4 2022 investor letter. Headquartered in Luxembourg, Millicom International Cellular S.A. (NASDAQ:TIGO) provides cable and mobile service. On March 10, 2023, Millicom International Cellular S.A. (NASDAQ:TIGO) stock closed at $18.36 per share. One-month return of Millicom International Cellular S.A. (NASDAQ:TIGO) was -1.50%, and its shares lost 21.77% of their value over the last 52 weeks. Millicom International Cellular S.A. (NASDAQ:TIGO) has a market capitalization of $3.137 billion.
Bonhoeffer Capital Management made the following comment about Millicom International Cellular S.A. (NASDAQ:TIGO) in its Q4 2022 investor letter:
“Millicom International Cellular S.A. (NASDAQ:TIGO), a Latin American telecommunications firm that provides high-speed internet, cable, and wireless to nine markets, has become a special situation, as two strategic investors are ether bidding for the entire firm or purchasing large stakes in Millicom. Millicom is also in the process of separating both its towers business (about 10,000 towers) and its TIGO Money business for either sale or co-investment. Based upon historical tower sales by Millicom and comparable transactions and trading prices for Latin American tower businesses, we think the towers are worth about $1.4 billion or $8.00 per share. Given the current price of Millicom, the stub has an implied value of about 11.6x 2022 FCF or 2.9x projected 2026 FCF. Given the liquidity from recent rights offering, Millicom’s debt level is low, and the company will be in the position to buy back shares next year while continuing to invest in its fiber rollout. There is additional value outside the core business in Millicom’s data centers and TIGO Money (see our case study in the Q3 2021 letter). Given a conservative projected EPS growth of 10% per year (vs. the 25% projected FCF growth rate), Millicom should trade at 22x earnings using Graham’s formula of 8.5 + 2 * growth rate. Applying this multiple results in about a 2x return today and a 7x return in five years. Below is an updated value of Millicom’s equity given the rights offering, management’s current forecast to 2024, and no value for Millicom’s data centers or TIGO Money.…” (Click here to read the full text)
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Millicom International Cellular S.A. (NASDAQ:TIGO) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 10 hedge fund portfolios held Millicom International Cellular S.A. (NASDAQ:TIGO) at the end of the fourth quarter which was 8 in the previous quarter.
We discussed Millicom International Cellular S.A. (NASDAQ:TIGO) in another article and shared Longleaf Partners’ views on the company. In addition, please check out our hedge fund investor letters Q4 2022 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.
