Alex Roepers Atlantic Investment Management Portfolio Tracker – Q1 2022 Update

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This article is part of a series that provides ongoing analysis of changes to Alex Roepers’ 13F portfolio on a quarterly basis. It is based on Roepers Regulatory Form 13F filed on 05/16/2022. Please visit our Alex Roepers Atlantic Investment Management portfolio monitoring article to get an idea of ​​his investment philosophy and our Last update for fund movements during the fourth quarter of 2021.

This quarter, the value of Roepers’ 13F portfolio has grown from about $358 million to about $310 million. The number of holdings has increased from 10 to 11. The top three holdings represent approximately 46%, while the top five represent approximately 70% of 13F assets: Westrock Company, Huntsman Corp, Eastman Chemical, Univar Solutions and Timken.

Atlantic Investment Management’s annualized returns from the flagship fund’s inception in 1992 through 2017 have been impressive at around 16%. For the past four years, the fund has underperformed the S&P 500 Index. For more on activist investing, see Deep Value: Why Activist Investors and Other Opponents Fight for Control of Losing Companies.

New issues:

Ralph Lauren (RL): RL is an 8.23% portfolio stake established this quarter at prices between ~$101 and ~$134 and the stock is currently trading at ~$106.

Sale of interests:

None.

Bet increase:

Timken Corporation (TKR): TKR represents approximately 10% of the portfolio position established last quarter at prices between ~$64 and ~$77. This quarter saw a one-third increase in stake at prices between ~$59 and ~$75. The stock is currently trading at $63.14.

Goodyear (GT) tires and rubber: GT represents approximately 9% of the portfolio position purchased in Q3 2021 at prices between ~$14.50 and ~$18.75. The last quarter saw a reduction of around 5%, while this quarter there was an increase of around 13%. The stock is currently trading at $13.69.

Lear Corp. (LEA): LEA represents approximately 8% of the portfolio position established in Q4 2020 at prices between ~$113 and ~$165 and the stock is currently trading at ~$141. There was a ~12% cut last quarter at prices between ~$146 and ~$188, while this quarter there was a slight increase of ~5%.

The bet decreases:

WestRock Co. (WRK): WRK is currently the largest 13F position with 14.55% of the portfolio. It was built in Q4 2019 at prices between $33.50 and $43.25. The first quarter of 2020 saw a sale of around 17% while the following quarter saw a two-thirds increase at prices between $24 and $34. The fourth quarter of 2020 saw a reduction of around 10% while the following quarter there was an increase in participation of around 20% at prices between ~$41 and ~$54. The two quarters through Q3 2021 had seen around 22% selling at prices between ~$48 and ~$62. The stock is currently at $48.59. The last quarter saw an increase in participation of around 15%, while this quarter there was a similar reduction.

Huntersman Corp. (HUN): HUN is currently the second largest position with 13.46% of the portfolio. It was established in the first quarter of 2021 at prices between ~$25 and ~$29.50. Stake more than doubled in the following quarter at prices between ~$25 and ~$31.60. This quarter saw a reduction of around 36% at prices between ~$35 and ~$41. The stock is currently trading at $36.21.

Note: Huntsman is a frequently traded pick in the wallet. Details of the latest round trip follow: it was about 5% of the portfolio stake established in the second quarter of 2017 at prices between $23 and $27. The five quarters up to the second quarter of 2019 had seen a combined sale of around 50% at prices between $17.35 and $35.30. This was followed by another two-thirds selling the following quarter at prices between $18.25 and $23.50. The fourth quarter of 2019 saw the position nearly eliminated at prices between $21.50 and $25. The remaining stake was sold in the first half of 2020.

Eastman Chemical (EMN): EMN was a large holding established in Q4 2015 at prices between $65 and $74. The position wavered. Recent activity follows: H2 2019 and Q1 2020 had seen the position sold at prices between $38 and $83.90. It was rebuilt last quarter at prices between ~$101 and ~$121. There were ~25% sales this quarter at prices between ~$105 and ~$128. The stock is now at ~$111 and the stake is at 11.36% of the portfolio.

Univar Solutions (UNVR): The large (top five) ~11% portfolio stake in UNVR was established in Q2 2020 at prices between $9.60 and $18.15. The two quarters through Q1 2021 had seen a one-third increase in stake at prices between ~$16.50 and ~$22. This quarter saw around 45% selling at prices between ~$26.50 and ~$34. The stock is currently trading at $32.21.

Avnet, Inc. (AVT): AVT’s large ~10% stake was purchased in Q4 2020 at prices between ~$24.50 and ~$35.25. There was a roughly 30% stake increase in the next quarter at prices between ~$35 and ~$41.50. The last quarter saw an increase in participation of around 11%, while this quarter there was a reduction of around 17%. The stock is now at $48.96.

Nomadic Foods (NOMD): NOMD is a 1.31% position established over the past two quarters at prices between ~$24 and ~$29 and the stock is currently trading well below that range at $20.73. There was a roughly 25% reduction this quarter at prices between ~$20 and ~$27.

Note: Nomad Foods is back in the portfolio after a quarter of a gap. A similar stake was established in Q4 2020 at prices between ~$22.60 and ~$26.15. It was phased out the following quarter at prices between ~$27.50 and ~$31.50.

Maintained stable:

OI glass (OI), formerly Owens Illinois: OI is a very long-term issue. In 2008 the position was tiny and was built to 11.2 million shares in 2012 through regular buying. Recent activity follows: Q4 2020 saw around 45% selling at prices between ~$9.40 and ~$13. The two quarters up to Q2 2021 had seen around 75% more sold at prices between $11.50 and $19.30. The stock is currently trading at $16.68 and the stake is now low at 2.79% of the portfolio.

The spreadsheet below highlights changes to Roepers’ 13F stock holdings in Q1 2022:

Alex Roepers - Atlantic Investment Management Q1 2022 13F Report Q/Q Comparison

Alex Roepers – Atlantic Investment Management Q1 2022 13F Report Q/Q Comparison (John Vincent (author))

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