Brown Capital Management, an investment management company, released its “The Brown Capital Management Mid Company Strategy” Q3 2022 investor letter. A copy of the same can be downloaded here. The Mid Company Composite returned -4.52% in the quarter compared to a -0.65% return for the Russell Midcap Growth Index. The firm invests in mission-critical companies and owns companies with a competitive advantage and skilled managers. In addition, check the fund’s top five holdings to know its best picks in 2022.
Brown Capital Management highlighted stocks like Bright Horizons Family Solutions Inc. (NYSE:BFAM) in the Q3 2022 investor letter. Headquartered in Newton, Massachusetts, Bright Horizons Family Solutions Inc. (NYSE:BFAM) is an early education and childcare provider. On December 20, 2022, Bright Horizons Family Solutions Inc. (NYSE:BFAM) stock closed at $63.23 per share. One-month return of Bright Horizons Family Solutions Inc. (NYSE:BFAM) was -12.77%, and its shares lost 46.89% of their value over the last 52 weeks. Bright Horizons Family Solutions Inc. (NYSE:BFAM) has a market capitalization of $3.652 billion.
Brown Capital Management made the following comment about Bright Horizons Family Solutions Inc. (NYSE:BFAM) in its Q3 2022 investor letter:
“Bright Horizons Family Solutions Inc. (NYSE:BFAM) is the leading provider of employer-sponsored childcare and early childhood education with more than 1,000 full-service centers across the U.S., U.K. and Netherlands. The company also offers back-up dependent care and educational-advisory services. It is substantially larger than its closest competitor and boasts more than one-third of the Fortune 500 as clients. In early 2020, the global pandemic led Bright Horizons to temporarily close more than 80% of its centers, leaving open only those serving children of essential employees. By the end of 2020, Bright Horizon’s share-price recovered as COVID mitigation efforts allowed the company to reopen 90% of its centers.
Recently, shares sold off on continuing concerns regarding how work-from-home (WFH) trends would affect demand for Bright Horizons’s services as well as the company’s ability to source childcare providers in a tight labor market. We believe the company’s existing operational strength should allow it to make some location changes in response to WFH developments, while also seeing improved demand from its backup-childcare offering. With less than 10% of U.S. companies offering childcare benefits, and less than 5% of the industry controlled by large operators like Bright Horizons, we believe the company has many more years of high-single-digit revenue growth and low-to-mid-teens earnings growth. Nonetheless, the challenges to the company’s business have lasted longer than we expected and we are revisiting our initial investment thesis to ensure that the company can deliver our longer-term expectations.”
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Bright Horizons Family Solutions Inc. (NYSE:BFAM) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 27 hedge fund portfolios held Bright Horizons Family Solutions Inc. (NYSE:BFAM) at the end of the third quarter, which was 23 in the previous quarter.
We discussed Bright Horizons Family Solutions Inc. (NYSE:BFAM) in another article and shared Conestoga Capital Advisors views on the company. 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.
