Is it Still Safe to Own Bright Horizons (BFAM)?

Upslope Capital Management, an investment management firm, published its second-quarter 2022 investor letter – a copy of which can be downloaded here. A quarterly portfolio net return of +0.8% was recorded by the fund for the second quarter of 2022, compared to the S&P Midcap 400 ETF and the HFRX Equity Hedge Index which delivered -15.4% and -4.4% gains for the same period. Go over the fund’s top 5 positions to have a glimpse of its finest picks for 2022.

In its Q2 2022 investor letter, Upslope Capital Management mentioned Bright Horizons Family Solutions Inc. (NYSE:BFAM) and explained its insights for the company. Founded in 1986, Bright Horizons Family Solutions Inc. (NYSE:BFAM) is a Newton, Massachusetts-based child-care provider with a $5.5 billion market capitalization. Bright Horizons Family Solutions Inc. (NYSE:BFAM) delivered a -25.28% return since the beginning of the year, while its 12-month returns are down by -38.41%. The stock closed at $94.06 per share on July 28, 2022.

Here is what Upslope Capital Management has to say about Bright Horizons Family Solutions Inc. (NYSE:BFAM) in its Q2 2022 investor letter:

“Bright Horizons is a leading childcare provider with a unique corporate partnership model. Upslope’s thesis was that BFAM was hit hard by COVID-19 but should ultimately emerge competitively stronger. This thesis broke in Q2 (arguably, I confess, much earlier), as the company continued to struggle on most fronts (enrollment + margins) and announced its largest-ever acquisition – in Australia. In addition to poor timing (aggressive deal from a position of weakness), the acquisition also signaled to me a lack of near-term opportunities in BFAM’s core U.S. market.”

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Our calculations show that Bright Horizons Family Solutions Inc. (NYSE:BFAM) fell short and didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. Bright Horizons Family Solutions Inc. (NYSE:BFAM) was in 21 hedge fund portfolios at the end of the second quarter of 2022, compared to 25 funds in the previous quarter. Bright Horizons Family Solutions Inc. (NYSE:BFAM) delivered a -21.92% return in the past 3 months.

In June 2022, we also shared another hedge fund’s views on Bright Horizons Family Solutions Inc. (NYSE:BFAM) in another article. You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q2 page.

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