Heartland Advisors, an investment management company, released its “Heartland Opportunistic Value Equity Strategy” third quarter 2022 investor letter. A copy of the same can be downloaded here. In the third quarter, the strategy returned -4.47% Net of Bundled Fees compared to the Russell 3000 Value Index’s -5.56% return. The strategy’s outperformance in the quarter was attributed to stock selection. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.
Heartland Advisors highlighted stocks like Starbucks Corporation (NASDAQ:SBUX) in its Q3 2022 investor letter. Headquartered in Seattle, Washington, Starbucks Corporation (NASDAQ:SBUX) is a global specialty coffee retailer. On December 6, 2022, Starbucks Corporation (NASDAQ:SBUX) stock closed at $102.08 per share. One-month return of Starbucks Corporation (NASDAQ:SBUX) was 10.06% and its shares lost 12.209% of their value over the last 52 weeks. Starbucks Corporation (NASDAQ:SBUX) has a market capitalization of $117.167 billion.
Heartland Advisors made the following comment about Starbucks Corporation (NASDAQ:SBUX) in its Q3 2022 investor letter:
“An example of this focus is Starbucks Corporation (NASDAQ:SBUX), a position initiated during the quarter. The coffee giant’s moat is driven by its global scale and brand recognition. Recently, Starbucks grappled with shifting challenges as a result of COVID-19. During the pandemic, demand migrated from Starbucks’ urban locations to overwhelmed suburban stores, as the remote workforce increased, and many remain in a hybrid or work-from-home mode. This, along with stricter COVID-19 lockdowns in China, resulted in margin compression while many of sector peers enjoyed unprecedented margin expansion owing to government stimulus.
Starbucks has been investing aggressively to address these inefficiencies. Actions taken include raising wages to reduce turnover, redesigning stores to respond to the rise in mobile ordering, and reengineering equipment to improve barista productivity as more complicated cold beverages now account for more than 50% of total sales.
Starbucks also happens to be well-positioned to deal with inflation given the company’s history of pricing power. Over the past year, the company has raised its prices by approximately 5-7%, which is less than the rate of headline inflation. Starbucks likely has room to hike prices further because of the brand recognition and a loyal customer base, as evidenced by more than half of U.S. sales being derived from the Starbucks reward members.”
Starbucks Corporation (NASDAQ:SBUX) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 54 hedge fund portfolios held Starbucks Corporation (NASDAQ:SBUX) at the end of the third quarter, which was 55 in the previous quarter.
We discussed Starbucks Corporation (NASDAQ:SBUX) in another article and shared the list of stocks that Jim Cramer and billionaire Ray Dalio are betting on. In addition, please check out our hedge fund investor letters Q3 2022 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.
