In this article, we discuss the top 5 stock picks of Mark Travis’s Intrepid Capital Management. If you want our detailed analysis of these stocks, go directly to Mark Travis’s Intrepid Capital Management’s Top 10 Stock Picks.
5. LGI Homes, Inc. (NASDAQ:LGIH)
Intrepid Capital Management’s Stake Value: $5,099,000
Percentage of Intrepid Capital Management’s 13F Portfolio: 2.69%
Number of Hedge Fund Holders: 17
LGI Homes, Inc. (NASDAQ:LGIH), one of the top stock picks of Mark Travis’s Intrepid Capital Management, is a construction company engaged in developing housing communities in the Southwestern US region. Intrepid Capital Management owns 31,488 shares in LGI Homes, Inc. (NASDAQ:LGIH), valued over $5 million, representing 2.69% of the firm’s portfolio at the end of June this year.
As of the second quarter of 2021, 17 hedge funds were long LGI Homes, Inc. (NASDAQ:LGIH), up from 16 in the preceding quarter.
LGI Homes, Inc. (NASDAQ:LGIH), on November 2, reported a Q3 EPS of $4.05, beating analysts’ estimates by $0.04. Revenue for the quarter also exceeded expectations at $751.61 million by $19.62 million.
JPMorgan analyst Michael Rehaut kept an Underweight rating on LGI Homes, Inc. (NASDAQ:LGIH) on October 14, lowering the price target from $156 to $115, maintaining a constructive stance of the homebuilding sector.
Here is what Fiduciary Management has to say about LGI Homes, Inc. (NASDAQ:LGIH) in its Q3 2021 investor letter:
“LGI Homes engages in the design, construction, marketing, and sale of new single-family homes in the U.S. It participates in 34 markets across 18 states, with 9,339 closings per year as of 2020. It is the tenth largest residential home builder in the U.S., and focuses on building affordable, entry-level spec homes that are move-in ready. The company primarily markets its homes to renters in order to convert them into homeowners. It operates through the following segments: Central (39% of closings, 36% of revenues), Southeast (26% of closings, 24% of revenues), Florida (13% of closings, 12% of revenues), West (11% of closings, 12% of revenues), and Northwest (11% of closings, 16% of revenues). The company was founded in 2003, completed its IPO in 2013, and is headquartered in The Woodlands, Texas…” (Click here to see the full text)
4. Dropbox, Inc. (NASDAQ:DBX)
Intrepid Capital Management’s Stake Value: $5,505,000
Percentage of Intrepid Capital Management’s 13F Portfolio: 2.90%
Number of Hedge Fund Holders: 39
A top stock according to Intrepid Capital Management’s Mark Travis, Dropbox, Inc. (NASDAQ:DBX) is an American software company offering file synchronization, cloud storage, on-demand services, and other software to customers. Intrepid Capital Management owns 181,632 shares in Dropbox, Inc. (NASDAQ:DBX), as of June 2021, worth $5.50 million, representing 2.90% of the firm’s investment portfolio for Q2.
Dropbox, Inc. (NASDAQ:DBX) reported earnings for Q3 on November 4. The EPS for the quarter came in at $0.37, beating estimates by $0.02. Dropbox, Inc. (NASDAQ:DBX)’s revenue also exceeded analysts’ estimates by $5.48 million at $550.20 million.
At the end of the second quarter of 2021, 39 hedge funds in the elite database of Insider Monkey reported owning stakes in Dropbox, Inc. (NASDAQ:DBX), compared to 31 funds in the preceding quarter.
Here is what Saga Partners has to say about Dropbox, Inc. (NASDAQ:DBX) in their Q4 2020 investor letter:
“If I were to label certain decisions mistakes, Dropbox would fall in that category. Fortunately, this “mistake” did not incur a material loss to the Portfolio. However, just because an outcome was not unfavorable does not mean it was not a mistake.
The Portfolio first purchased Dropbox in 2019. My thesis originally surrounded the idea that Dropbox was the winning independent file/content sharing and collaboration platform that could potentially aggregate the increasing number of third-party work applications. This would create a neutral hub/platform for knowledge workers to manage their content and workflows. Dropbox had a strong track record and what I believed to be an advantageous position with its 600 million registered user base…” (Click here to see the full text)
3. WNS (Holdings) Limited (NYSE:WNS)
Intrepid Capital Management’s Stake Value: $7,149,000
Percentage of Intrepid Capital Management’s 13F Portfolio: 3.77%
Number of Hedge Fund Holders: 20
WNS (Holdings) Limited (NYSE:WNS) is a business process management, outsourcing, and IT consultancy company, headquartered in Mumbai, India. WNS (Holdings) Limited (NYSE:WNS) operates across 16 countries, operates 57 delivery centers around the world, and has clients from the travel, insurance, banking and financial services, manufacturing, retail, shipping, logistics, and healthcare industries. Intrepid Capital Management owns stakes worth $7.14 million in WNS (Holdings) Limited (NYSE:WNS), which represents 3.77% of the firm’s portfolio as of June this year.
WNS (Holdings) Limited (NYSE:WNS) announced Q3 earnings, with the EPS for the quarter being $0.64 on October 28, beating estimates by $0.08.
Barrington analyst Vincent Colicchio, on November 1, kept an Outperform rating on WNS (Holdings) Limited (NYSE:WNS), raising the price target to $104 from $95. The analyst observed year-over-year growth and expanding relationships with existing clients at WNS (Holdings) Limited (NYSE:WNS).
As of Q2, 20 hedge funds tracked by Insider Monkey were long WNS (Holdings) Limited (NYSE:WNS), down from 21 in Q1.
2. Take-Two Interactive Software, Inc. (NASDAQ:TTWO)
Intrepid Capital Management’s Stake Value: $9,047,000
Percentage of Intrepid Capital Management’s 13F Portfolio: 4.77%
Number of Hedge Fund Holders: 55
Take-Two Interactive Software, Inc. (NASDAQ:TTWO) is a video game holding company that owns flagship labels like Rockstar Games and 2K, which operate game development studios. Take-Two Interactive Software, Inc. (NASDAQ:TTWO) also supports private game developers under the company’s expansive labels. Intrepid Capital Management owns 51,110 shares in Take-Two Interactive Software, Inc. (NASDAQ:TTWO), valued at roughly $9 million, representing 4.77% of the firm’s Q2 portfolio. Some of the signature video games by Take-Two Interactive Software, Inc. (NASDAQ:TTWO) are Grand Theft Auto, BioShock, and NBA 2K, among others.
On November 3, the Q3 EPS for Take-Two Interactive Software, Inc. (NASDAQ:TTWO) came in at $1.63, beating estimates by $0.26. The revenue also surpassed estimates by $109.16 million at $984.85 million.
At the end of the second quarter of 2021, 55 hedge funds were bullish on Take-Two Interactive Software, Inc. (NASDAQ:TTWO), up from 41 in the preceding quarter.
JPMorgan analyst Alexia Quadrani on October 27 raised the price target on Take-Two Interactive Software, Inc. (NASDAQ:TTWO) from $190 to $200, keeping a Neutral rating on the stock.
Here is what Merion Road Capital Management has to say about Take-Two Interactive Software, Inc. (NASDAQ:TTWO) in its Q2 2021 investor letter:
“Take-Two also announced strong earnings and long-term outlook. While last year was a bit of an anomaly, it’s impressive that their key franchise (Grand Theft Auto) grew revenue from $700mm to almost $1bn in the fiscal year – keep in mind that it has now been over 7 years since their last full game release. Similarly, the NBA 2K franchise has continued to grow its user base which now stands at 2.3mm daily users. As the business model continues to shift to more recurrent spend, now at 60%, TTWO revenue becomes more stable, higher margin, and less dependent on key man risk. Additionally, the company has many shots on goal to generate a windfall from IP with a pipeline of 60 games to be released over the next 3 years (9 of which are iterations of previously released titles, ergo less risky).”
1. Skechers U.S.A., Inc. (NYSE:SKX)
Intrepid Capital Management’s Stake Value: $9,900,000
Percentage of Intrepid Capital Management’s 13F Portfolio: 5.22%
Number of Hedge Fund Holders: 35
Skechers U.S.A., Inc. (NYSE:SKX), the top stock in Mark Travis’s Intrepid Capital Management’s 13F portfolio, is the third largest athletic footwear brand in the United States. As of Q3, there are 4,170 Skechers U.S.A., Inc. (NYSE:SKX) stores around the world.
Skechers U.S.A., Inc. (NYSE:SKX) announced third quarter earnings on October 28. The Q3 EPS came in at $0.66, missing estimates by -$0.05. Skechers U.S.A., Inc. (NYSE:SKX)’s revenue also missed estimates by -$72.22 million at $1.55 billion.
Argus analyst John Staszak on November 2 downgraded Skechers U.S.A., Inc. (NYSE:SKX) from Buy to Hold, owing to the poor Q3 earnings. Despite strong demand for its products, the analyst sees manufacturing hindrances and delayed shipping, which will add to the company’s costs.
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