1. Garrett Motion Inc. (NASDAQ:GTX)
Centerbridge Partners’ Stake Value: $547,534,000
Percentage of Centerbridge Partners’ 13F Portfolio: 34.94%
Number of Hedge Fund Holders: 20
Garrett Motion Inc. (NASDAQ:GTX) and its subsidiaries develop, manufacture, and sell electric-boosting and turbocharger technologies all over the world. Regulatory filings show that Centerbridge Partners owned more than 66.21 million shares of Garrett Motion Inc. (NASDAQ:GTX) at the end of March worth $548 million, which represented a hefty 34.9% of its portfolio exposure, nearly 250% more than the next largest holding.
On July 28, Garrett Motion Inc. (NASDAQ:GTX) published its financial results for the second quarter, announcing earnings per share of $0.15, missing estimates by $0.09. In addition, its $859 million in revenue for the period was down 8.1% year-over-year and below estimates by $21 million.
Among the hedge funds tracked by Insider Monkey, Oaktree Capital Management is a leading shareholder of Garrett Motion Inc. (NASDAQ:GTX), with 68.9 million shares worth more than $569 million. At the end of the first quarter, 20 hedge funds held stakes in Garrett Motion Inc. (NASDAQ:GTX), an increase from 19 funds in the preceding quarter.
In its Q2 2022 investor letter, Alluvial Capital Management, an asset management firm, mentioned Garrett Motion Inc. (NASDAQ:GTX). Here is what the fund said:
“Garrett Motion is an exercise in patience. Just as it seemed the global automotive market was about to recover to pre-COVID production, along came Russia, inflation, and the threat of recession. Still, the company is making great strides in improving and simplifying its balance sheet. In June, the company redeemed the rest of the Series B preferred shares it issued to Honeywell when it exited bankruptcy in 2021. With the Series Bs out of the way, Garrett Motion is free to dedicate its cash flow to continued deleveraging or share buybacks. At some point in the next year or two, the conditions will be met for Garrett Motion to convert these preferreds and simplify their capital structure. If the market stubbornly refuses to value Garrett Motion shares at a reasonable price, I believe the company will pursue a sale or merger. Until then, our preferred shares will continue to accrue dividends at an attractive yield. The preferreds are worth at least $15 today, and possibly $20 or more if the company can reduce leverage and/or buy back shares and the automotive market recovers.”
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