David Nierenberg (Trades, Portfolio), the founder and president of Nierenberg Investment Management Company, recently filed the firm's 13F report for the second quarter of 2023. Nierenberg, a Yale College and Yale Law School graduate, manages the D3 Family of Funds, a group of four private investment partnerships. He also serves on the Washington State Investment Board, which manages public employee retirement funds. The firm's investment philosophy is rooted in value investing, focusing on undervalued stocks with strong growth potential.
Portfolio Overview
As of the end of Q2 2023, the firm's portfolio contained 32 stocks with a total value of $146 million. The top holdings were Mr. Cooper Group Inc (COOP, Financial) with 22.97% of the portfolio, Potbelly Corp (PBPB, Financial) with 16.28%, and EQT Corp (EQT) with 13.70%.
Top Three Trades of the Quarter
The following were the firm's top three trades of the quarter:
Potbelly Corp (PBPB, Financial)
During the quarter, Nierenberg Investment Management Company purchased 96,005 shares of Potbelly Corp (PBPB), bringing the total holding to 2,805,865 shares. This trade had a 0.57% impact on the equity portfolio. The stock traded for an average price of $8.75 during the quarter. As of August 15, 2023, Potbelly Corp had a market cap of $255.65 million and a stock price of $8.72. The stock has returned 45.50% over the past year. GuruFocus gives the company a financial strength rating of 4 out of 10 and a profitability rating of 5 out of 10. The company's valuation ratios include a price-earnings ratio of 20.76, a price-book ratio of 33.54, a EV-to-Ebitda ratio of 15.64, and a price-sales ratio of 0.55.
Mr. Cooper Group Inc (COOP, Financial)
The firm reduced its investment in Mr. Cooper Group Inc (COOP) by 39,000 shares, impacting the equity portfolio by 1.2%. The stock traded for an average price of $45.75 during the quarter. As of August 15, 2023, Mr. Cooper Group Inc had a market cap of $3.81 billion and a stock price of $57. The stock has returned 22.28% over the past year. GuruFocus gives the company a financial strength rating of 3 out of 10 and a profitability rating of 5 out of 10. The company's valuation ratios include a price-earnings ratio of 13.73, a price-book ratio of 0.93, a EV-to-Ebitda ratio of 20.87, and a price-sales ratio of 1.99.
Cantaloupe Inc (CTLP, Financial)
During the quarter, the firm purchased 144,518 shares of Cantaloupe Inc (CTLP), bringing the total holding to 2,422,358 shares. This trade had a 0.79% impact on the equity portfolio. The stock traded for an average price of $6.47 during the quarter. As of August 15, 2023, Cantaloupe Inc had a market cap of $546.43 million and a stock price of $7.535. The stock has returned 9.52% over the past year. GuruFocus gives the company a financial strength rating of 6 out of 10 and a profitability rating of 3 out of 10. The company's valuation ratios include a price-book ratio of 3.43, a EV-to-Ebitda ratio of 114.00, and a price-sales ratio of 2.28.
In conclusion, David Nierenberg (Trades, Portfolio)'s Q2 2023 13F filing reveals a portfolio with a strong focus on value investing. The firm's top trades of the quarter reflect a strategic approach to portfolio management, with a mix of new purchases and reductions in existing holdings.
