Greenhaven Road Capital, an investment management firm, published its fourth-quarter 2021 investor letter – a copy of which can be downloaded here. The fund returned approximately -9% net for the fourth quarter, bringing the full-year net return to approximately 3%. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.
Greenhaven Road Capital, in its Q4 2021 investor letter, mentioned Elastic N.V. (NYSE: ESTC) and discussed its stance on the firm. Elastic N.V. is a Mountain View, California-based information technology and data analysis services provider with an $8.6 billion market capitalization. ESTC delivered a -24.24% return since the beginning of the year, while its 12-month returns are down by -38.47%. The stock closed at $93.25 per share on January 31, 2022.
Here is what Greenhaven Road Capital has to say about Elastic N.V. in its Q4 2021 investor letter:
“Elastic (ESTC) – Elastic is the market leader in search and has a strong product line-up in security. Very few companies are able to consistently generate 30% more revenue from their existing customers than they did the year before. Elastic is one of them. Their Net Revenue Retention (NRR) has been hovering around 130% or higher for as long as it has been disclosed. The company has the benefit of operating in growing industries (data and security) and continues to both add new products and transition free (open source) users into paid users, particularly for their cloud-hosted business, which grew over 80% last quarter. Elastic recently announced that their CEO would be transitioning back to CTO, which spooked investors, but they also announced that they had exceeded guidance and will generate cash from operations this year. This is a company that has grown to $1B in sales in less than a decade and still has all of the capital that it raised on its balance sheet. Shares currently trade for less than 9X this year’s revenues, which should grow over 30% as the company becomes operating cash flow positive.”
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Our calculations show that Elastic N.V. (NYSE: ESTC) failed to obtain a mark on our list of the 30 Most Popular Stocks Among Hedge Funds. ESTC was in 59 hedge fund portfolios at the end of the third quarter of 2021, compared to 55 funds in the previous quarter. Elastic N.V. (NYSE: ESTC) delivered a -46.36% return in the past 3 months.
In November 2021, we also shared another hedge fund’s views on ESTC in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.
Disclosure: None. This article is originally published at Insider Monkey.
