3. SS&C Technologies Holdings, Inc. (NASDAQ:SSNC)
Baupost Group’s Stake Value: $180,149,000
Dividend Yield as of November 15: 1.49%
SS&C Technologies Holdings, Inc. (NASDAQ:SSNC) is a Connecticut-based software company that sells related services to the financial industry. The company has been raising its dividends consistently for the past 6 years. It currently offers a quarterly dividend of $0.20 per share for a dividend yield of 1.49%, as of November 15.
Highlighting the company’s recent quarterly earnings and expected slow demand for its products, Jefferies maintained a Hold rating on SS&C Technologies Holdings, Inc. (NASDAQ:SSNC) in October with a $55 price target.
Baupost Group has been investing in SS&C Technologies Holdings, Inc. (NASDAQ:SSNC) since the second quarter of 2020. The hedge fund raised its position in the company by 28% during Q3 2022, which takes its total stake to over $180 million. The company represented 3.1% of billionaire Seth Klarman’s portfolio.
At the end of Q2 2022, 50 hedge funds in Insider Monkey’s database owned stakes in SS&C Technologies Holdings, Inc. (NASDAQ:SSNC), growing from 48 in the previous quarter. These stakes have a collective value of over $2.7 billion.
LVS Advisory mentioned SS&C Technologies Holdings, Inc. (NASDAQ:SSNC) in its Q3 2022 investor letter. Here is what the firm has to say:
“SS&C Technologies Holdings, Inc. (NASDAQ:SSNC) is a publicly traded acquisition platform led by its founder Bill Stone who is also the largest shareholder. SS&C’s platform focuses on investment fund services (accounting, administration, back-office tools) and enterprise software. The company routinely makes large acquisitions in its target markets financed by debt and then quickly rationalizes the acquired companies and pays down debt. SS&C and its operators are very good at what they do. Since becoming public in 2010, SSNC has compounded its earnings per share at 25% per year (over 11 years). Despite this impeccable track record, the stock is down more than 40% this year. Investors are generally skeptical that an acquisition platform can generate strong investment returns given the current level of interest rates. Investors are also worried that SS&C’s customer base will be negatively impacted by the decline in asset prices. I am happy to take the other side of that bet! While SS&C will face some near-term headwinds from the market’s volatility, its client base is largely composed of private equity funds and hedge funds which have fared relatively well during 2022. SS&C’s valuation multiple is the cheapest it has ever been since its IPO and the company is aggressively buying back stock. A well-timed transaction could also be in the cards. SS&C made a number of outstanding, opportunistic acquisitions during the great recession from 2008 to 2010 and the company is primed to run that playbook again.”
