Here’s Why Polen Capital Sold its Exponent (EXPO) Shares

Polen Capital, an investment management firm, published its “Polen US SMID Company Growth Fund” first quarter 2022 investor letter – a copy of which can be downloaded here. Over the first quarter, the Polen U.S. SMID Company Growth Composite Portfolio (the “Portfolio”) returned -23.81% gross and -24.02% net of fees, respectively, underperforming the Russell 2500 Growth Index’s -12.30% return.  Try to spend some time looking at the fund’s top 5 holdings to be informed about their best picks for 2022. 

In its Q1 2022 investor letter, Polen US SMID Company Growth Fund mentioned Exponent, Inc. (NASDAQ:EXPO) and explained its insights for the company. Founded in 1967, Exponent, Inc. (NASDAQ:EXPO) is a Menlo Park, California-based research company with a $4.6billion market capitalization. Exponent, Inc. (NASDAQ:EXPO) delivered a -22.38% return since the beginning of the year, while its 12-month returns are down by 2.38%. The stock closed at $90.60 per share on June 02, 2022.

Here is what Polen US SMID Company Growth Fund has to say about Exponent, Inc. (NASDAQ:EXPO) in its Q1 2022 investor letter:

“We exited our position in research company Exponent in response to what we believed to be an unsustainable trajectory as it pertains to utilization and talent acquisition. A critical leading indicator, average full-time equivalent employees was up only 1% in the fourth quarter of 2021 and down 1% over the full-year 2021. We believe the company might be having issues recruiting and/or retaining talent. This is a people business that we believe is subject to risks related to the company’s ability to drive sustainable growth at the levels we expect from Exponent. We also believed the company was a good candidate for sale based on what we believed to be a lower expected return relative to other Portfolio holdings and companies in the research process.”

Our calculations show that Exponent, Inc. (NASDAQ:EXPO) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Exponent, Inc. (NASDAQ:EXPO) was in 24 hedge fund portfolios at the end of the first quarter of 2022, compared to 26 funds in the previous quarter. Exponent, Inc. (NASDAQ:EXPO) delivered a -6.95% return in the past 3 months. 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.