5 Small-Cap Stocks to Sell Now Before Recession Begins

3. Victory Capital Holdings, Inc. (NASDAQ:VCTR)

Number of Hedge Fund Holders: 18  

Market Cap as of May 27: $1.7 billion 

Percentage Decline in Share Price Year-to-Date: 22.05%

Victory Capital Holdings, Inc. (NASDAQ:VCTR) operates as an asset management firm. On May 11, the company reported that assets under management at the end of April were around $166 billion, a fall of 6.8% from the previous month when they had been around $178 billion. However, the firm reported a month-on-month increase in alternative asset class which stood at $4.58 billion, up 14% from $4.03 billion at the end of March. The Solutions AUM fell by 7.6% during the month to $54 billion. 

On May 23, B Riley analyst Matt Howlett reiterated a Buy rating on Victory Capital Holdings, Inc. (NASDAQ:VCTR) stock with a price target of $36, noting that the firm had delivered significant growth since inception. 

Among the hedge funds being tracked by Insider Monkey, London-based investment firm Impax Asset Management is a leading shareholder in Victory Capital Holdings, Inc. (NASDAQ:VCTR), with 972,198 shares worth more than $28 million. 

At the end of the first quarter of 2022, 20 hedge funds in the database of Insider Monkey held stakes worth $113 million in Victory Capital Holdings, Inc. (NASDAQ:VCTR), compared to 18 in the preceding quarter worth $129 million. 

In its Q4 2021 investor letter, Gator Capital Management, an asset management firm, highlighted a few stocks and Victory Capital Holdings, Inc. (NASDAQ:VCTR) was one of them. Here is what the fund said:

“Although higher interest rates will benefit the Fund’s portfolio, we are making sure that the Fund is not simply a bet on higher rates. We have several large holdings with inexpensive valuations and catalysts unrelated to higher interest rates. Victory Capital Holdings, Inc. (NASDAQ:VCTR) is an asset manager making attractive acquisitions of smaller asset managers, trading at 6x earnings, and returning capital to shareholders through increased dividends and share repurchases.”