Investment management company First Pacific Advisors recently released its “FPA Queens Road Small Cap Value Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. In the first quarter, the fund returned -2.51% compared to a -7.74% return for the Russell 2000 Value Index. President Trump announced his tariffs on April 2nd, causing equity markets to decline sharply and increasing volatility. Additionally, you can check the fund’s top 5 holdings to determine its best picks for 2025.
In its first-quarter 2025 investor letter, FPA Queens Road Small Cap Value Fund highlighted stocks such as Scholastic Corporation (NASDAQ:SCHL). Scholastic Corporation (NASDAQ:SCHL) engages in the publishing and distribution of children’s books worldwide. The one-month return of Scholastic Corporation (NASDAQ:SCHL) was 0.69%, and its shares lost 53.02% of their value over the last 52 weeks. On May 21, 2025, Scholastic Corporation (NASDAQ:SCHL) stock closed at $17.44 per share with a market capitalization of $465.413 million.
FPA Queens Road Small Cap Value Fund stated the following regarding Scholastic Corporation (NASDAQ:SCHL) in its Q1 2025 investor letter:
“Scholastic Corporation (NASDAQ:SCHL) is an educational publishing company that runs the eponymous book fairs in America’s K-12 schools. We first bought shares in 2008 and have added a little overtime. Over 15 years, results have been volatile as Scholastic has never been able to translate its name brand, publishing assets or forays into adjacent markets into consistent earnings. The company has always traded at a discount compared to its economic earnings potential. It also owns prime New York City real estate that we estimate to be worth $300 – $400 million. We were cautiously optimistic when Thomson Reuters’ Peter Warwick became CEO in 2021. Poor performance at the company’s book fairs caused the stock to drop 20% following results on July 19, 2024, and another 20% following results reported on December 20, 2024. We’ve added to our position on this weakness.”
A diverse group of children gathered in a bookstore perusing through a variety of titles.
Scholastic Corporation (NASDAQ:SCHL) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 14 hedge fund portfolios held Scholastic Corporation (NASDAQ:SCHL) at the end of the fourth quarter which was 16 in the previous quarter. In the third quarter of fiscal 2025, Scholastic Corporation’s (NASDAQ:SCHL) revenue grew 4% to $335.4 million. While we acknowledge the potential of Scholastic Corporation (NASDAQ:SCHL) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.
In another article, we covered Scholastic Corporation (NASDAQ:SCHL) and shared FPA Queens Road Small Cap Value Fund’s views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q1 2025 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.
