Decline in Commodity Prices Affected Natural Gas Services Group (NGS) in Q1

Palm Valley Capital Management, an investment management firm, released its first quarter 2023 investor letter. A copy of the same can be downloaded here. In the first quarter, Palm Valley Capital Fund returned 3.01% compared to a 2.57% rise for the S&P SmallCap 600 Index and a 4.90% return for the Morningstar Small Cap Index. The fund’s securities returned 12.2% during the quarter. The fund’s performance early in the quarter was below its benchmark while closing the gap by quarter end. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.

Palm Valley Capital Management highlighted stocks like Natural Gas Services Group, Inc. (NYSE:NGS) in the first quarter 2023 investor letter. Headquartered in Midland, Texas, Natural Gas Services Group, Inc. (NYSE:NGS) provides natural gas compression services and equipment to the energy industry. On April 6, 2023, Natural Gas Services Group, Inc. (NYSE:NGS) stock closed at $10.66 per share. One-month return of Natural Gas Services Group, Inc. (NYSE:NGS) was -2.11%, and its shares lost 5.91% of their value over the last 52 weeks. Natural Gas Services Group, Inc. (NYSE:NGS) has a market capitalization of $132.691 million.

Palm Valley Capital Management made the following comment about Natural Gas Services Group, Inc. (NYSE:NGS) in its Q1 2023 investor letter:

“For the three-month period, the Fund had one security negatively affecting performance by more than 10 basis points: Natural Gas Services Group, Inc. (NYSE:NGS). The company’s recent financial results have trended in the right direction. However, the slow pace of improvement has lagged the energy service industry. Many companies in the space have traded down due to falling commodity prices. Natural gas prices touched the lowest levels in over two years a few days ago. In May 2022, the company’s longtime CEO Stephen Taylor retired and was replaced on an interim basis by a director. Six months later, Mr. Taylor returned to lead the company. Since December, two activist shareholders have sent letters to the board, with one demanding the company explore strategic alternatives and the other nominating two candidates as directors. These investors may be pouncing on the firm’s low valuation and perceived opportunity to drive faster operating progress.”

Newpark Resources Inc (NR), NYSE:NR,

Natural Gas Services Group, Inc. (NYSE:NGS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 6 hedge fund portfolios held Natural Gas Services Group, Inc. (NYSE:NGS) at the end of the fourth quarter which was 7 in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2023 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.