Should You Hold Garrett Motion (GTX)?

Alluvial Capital Management, an investment advisory firm, released its third-quarter 2022 investor letter. A copy of the same can be downloaded here. Macroeconomic concerns affected the fund’s quarterly performance and it declined by 2.2%, in line with the benchmark indexes. However, the fund outperformed its benchmark indexes by 7% annually since inception in 2017. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.

Alluvial Capital discussed stocks like Garrett Motion Inc. (NASDAQ:GTX) in the Q3 2022 investor letter. Headquartered in Rolle, Switzerland, Garrett Motion Inc. (NASDAQ:GTX) engages in the business of turbochargers and electric-boosting technologies. On October 27, 2022, Garrett Motion Inc. (NASDAQ:GTX) stock closed at $6.69 per share. One-month return of Garrett Motion Inc. (NASDAQ:GTX) was 15.20% and its shares lost 1.91% of their value over the last 52 weeks. Garrett Motion Inc. (NASDAQ:GTX) has a market capitalization of $433.635 million.

Alluvial Capital made the following comment about Garrett Motion Inc. (NASDAQ:GTX) in its Q3 2022 investor letter:

Garrett Motion Inc. (NASDAQ:GTX) has elected to begin paying cash dividends on its convertible preferred shares. Doing so prevents dividends in arrears from further accruing and is a wise use of the company’s free cash flow. I believe the choice to initiate a cash dividend is a tacit admission by the company that the necessary conditions for converting the preferred shares will not be met soon. This is a mild short-term negative, as the complex capital structure will remain in place for now. On the other hand, I am thrilled for us to earn a 9% yield as the company uses its free cash flow to buy back cheap stock and wait for the automotive cycle to turn.”

Garrett Motion Inc. (NASDAQ:GTX) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 23 hedge fund portfolios held Garrett Motion Inc. (NASDAQ:GTX) at the end of the second quarter which was 20 in the previous quarter.

We discussed Garrett Motion Inc. (NASDAQ:GTX) in another article and shared the best stocks to buy according to billionaire Howard Marks’ Oaktree Capital. 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.