Lakewood Capital Management Investor Letter: Short Theses on Axon Enterprise (AAXN), AeroVironment (AVAV)

Anthony Bozza‘s Lakewood Capital Management suffered a net loss of 1.2% in Q2, being dragged down by its short positions in particular, including in electric automaker Tesla, Inc. (NASDAQ:TSLA), which gained 7% in the first-half of 2018.

The fund believes that the market’s taste for speculative growth stocks presents challenges to its value-based long/short approach, but was nonetheless extremely confident on the prospects of its portfolio heading into the second-half of this year. In fact, its modeled returns were at their highest levels in years, which compelled the fund to push its long position concentration and overall gross exposure past their historical averages.

In its Q2 investor letter, Lakewood Capital Management shared its updated thoughts on several of its long and short positions, including Citigroup Inc. (NYSE:C), Axon Enterprise, Inc. (NASDAQ:AAXN), Baidu, Inc. (NASDAQ:BIDU), Apollo Global Management, LLC (NYSE:APO), and AeroVironment, Inc. (NYSE:AVAV).

You can download a copy of the full investor letter here.

Disclosure: None