Investment management company Cove Street Capital recently released its “Small Cap Value Fund” fourth quarter 2023 investor letter. A copy of the same can be downloaded here. In 2023, the fund returned 18.33% compared to 16.93% for the Russell 2000 Index and 15.26% for the Russell 2000 Value Index. The fund returned 8.35% in the fourth quarter compared to 14.03% and 15.26% for the indexes, respectively. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
In its Q4 2023 investor letter, Cove Street Capital featured stocks such as OUTFRONT Media Inc. (NYSE:OUT). OUTFRONT Media Inc. (NYSE:OUT) leases advertising space on out-of-home advertising structures and sites. On January 5, 2024, OUTFRONT Media Inc. (NYSE:OUT) stock closed at $13.75 per share. One-month return of OUTFRONT Media Inc. (NYSE:OUT) was 9.74%, and its shares lost 23.18% of their value over the last 52 weeks. OUTFRONT Media Inc. (NYSE:OUT) has a market capitalization of $2.269 billion.
Cove Street Capital stated the following regarding OUTFRONT Media Inc. (NYSE:OUT) in its fourth quarter 2023 investor letter:
“OUTFRONT Media Inc. (NYSE:OUT) was a new position for CSC and it brings a smile to our faces here at Cove Street when a new position shows up as a top contributor because the two are often uncorrelated. Outfront is one of the Big 3 billboard companies, mostly in the US. It is mostly structured as Real Estate Investment Trust (“REIT”). Properly run, the Billboard segment is a “great one” – very high returns on tangible capital, limited and highly coveted real estate, great free cash flow and a secular profitability uptick from a conversion from wood to digital. A few unfunny things happened on the way to the bank, which lead to a decline from the mid $20’s to our entry point (~$10). You might recognize from these themes from the discussion of SSP: a general advertising slowdown, a particular slowdown from the auto and the movie industry strikes, and yes, Covid…again. Outfront has 20-ish percent of its revenue from public transport venues and you might have read people are resisting coming back to work in major cities. Our research suggests that most of this was cyclical rather than permanent. The company had multiple avenues for improving the balance sheet, like selling their Canadian business for almost 2x the trading multiple of the entire company shortly after purchase. Arguably, the stock was selling for half our estimate of value in a reasonable environment. So far so good.”
A digital billboard on a bustling street corner, showing the modern way of advertising.
OUTFRONT Media Inc. (NYSE:OUT) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 26 hedge fund portfolios held OUTFRONT Media Inc. (NYSE:OUT) at the end of third quarter which was 24 in the previous quarter.
We discussed OUTFRONT Media Inc. (NYSE:OUT) in another article and shared the list of stocks with highest dividend. In addition, please check out our hedge fund investor letters Q4 2023 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.
