Rowan Street Capital LLC, an investment management firm, published its first-quarter 2022 investor letter – a copy of which can be seen here. The past two quarters have been difficult for all growth investors and certainly for Rowan Street partners. COVID reopening, inflation, the threat of a rapid increase in interest rates as well as the war going on in Europe all contributed to a very rapid market rotation out of growth stocks, which were the darlings of the 2020-21 time period. These types of rotations and corrections are normal and to be expected from time to time. 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, Rowan Street Capital mentioned Netflix, Inc. (NASDAQ:NFLX) and explained its insights for the company. Founded in 1997, Netflix, Inc. (NASDAQ:NFLX) is a Los Gatos, California-based subscription streaming service and production company with a $154.8 billion market capitalization. Netflix, Inc. (NASDAQ:NFLX) delivered a -42.13% return since the beginning of the year, while its 12-month returns are down by -36.57%. The stock closed at $348.61 per share on April 19, 2022.
Here is what Rowan Street Capital has to say about Netflix, Inc. (NASDAQ:NFLX) in its Q1 2022 investor letter:
“The beauty of the public markets is that if you can be patient, there is a good chance the volatility of the marketplace will give you the chance to own companies on your watch list. The stock prices of our 3 new positions (please refer to charts below) have fluctuated from 100-350% over the past 12 months (when comparing 52-week high by 52-week low). Certainly, the underlying value of a business doesn’t fluctuate that much on an annual basis, so the public markets are a fantastic arena to buy businesses if you can sit still without growing tired of sitting still. Netflix is the 3rd position that we have recently added to the portfolio, taking advantage of the drastic decline in its stock in 2022. Netflix stock has now given up all of its pandemic gains, despite growing its operating profits by 3x and its earnings per share by 3.5x since 2020.”
Photo by Souvik Banerjee on Unsplash
Our calculations show that Netflix, Inc. (NASDAQ:NFLX) ranks 10th on our list of the 30 Most Popular Stocks Among Hedge Funds. Netflix, Inc. (NASDAQ:NFLX) was in 113 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 106 funds in the previous quarter. Netflix, Inc. (NASDAQ:NFLX) delivered a -31.75% return in the past 3 months.
In April 2022, we also shared another hedge fund’s views on Netflix, Inc. (NASDAQ:NFLX) 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.
