Here’s Why ClearBridge Investments Sold its Vroom (VRM) Shares

ClearBridge Investments, an investment management firm, published its “SMID Cap Growth Strategy” first quarter 2022 investor letter – a copy of which can be downloaded here. During the first quarter, the ClearBridge SMID Cap Growth Strategy underperformed its Russell 2500 Growth benchmark. On an absolute basis, the Strategy had losses across eight of the 10 sectors in which it was invested during the quarter (out of 11 sectors total), with the IT, industrials, consumer discretionary and health care sectors the primary detractors, while the consumer staples and energy sectors were contributors. Try to spend some time taking a look at the fund’s top 5 holdings to be informed about their best picks for 2022.

In its Q1 2022 investor letter, ClearBridge Investments  SMID Cap Growth Strategy mentioned Vroom, Inc. (NASDAQ:VRM) and explained its insights for the company. Founded in 2012, Vroom, Inc. (NASDAQ:VRM)  is a United States-based used car retailer and e-commerce company with a $204.9 million market capitalization. Vroom, Inc. (NASDAQ:VRM)  delivered a -86.75% return since the beginning of the year, while its 12-month returns are down by -96.67%. The stock closed at $1.43 per share on May 05, 2022. 

Here is what ClearBridge Investments  SMID Cap Growth Strategy has to say about Vroom, Inc. (NASDAQ:VRM) in its Q1 2022 investor letter:

“Among Strategy exits, we eliminated online car sales platform Vroom (NASDAQ:VRM) due to continuing execution woes, operating deficits and a major pivot to sub-prime financing through a large acquisition.”

Photo by Malusi Msomi on Unsplash

Our calculations show that Vroom, Inc. (NASDAQ:VRM) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Vroom, Inc. (NASDAQ:VRM) was in 28 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 23 funds in the previous quarter. Vroom, Inc. (NASDAQ:VRM) delivered a -80.11% return in the past 3 months.

In January 2022, we also shared another hedge fund’s views on Vroom, Inc. (NASDAQ:VRM) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q1 page.

Disclosure: None. This article is originally published at Insider Monkey.