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Joseph Jolson’s Harvest Capital Strategies’ Return, AUM, and Holdings (Part II)

Nina Zdinjak

Read the beginning of this article here.

The most valuable position in Harvest Capital Strategies’ portfolio at the end of the last quarter of 2018 was in Palo Alto Networks Inc (NYSE:PANW), and it counted 185,000 shares with a value of $34.85 million after the fund had raised its stake by 69%. This position comprised 9.72% of its 13F portfolio. Palo Alto Networks is a Santa Clara-based cybersecurity company with a market cap of $22.85 billion. Year-to-date, the company’s stock gained 30.60%, and on April 22nd it had a closing price of $239.28. For the second quarter of fiscal 2019 Palo Alto Networks reported total revenue of $711.2 million, compared to $545.6 million for the equivalent period of 2018. It also disclosed a GAAP net loss of $2.6 million, or $0.03 per diluted share (fiscal Q2 2019), versus a GAAP net loss of $25.6 million, or $0.28 per diluted share (fiscal q2 2018). Around a month ago, the company announced that it plans to purchase security startup Demisto for $560 million in order to boost its security portfolio by adding more powerful automated solutions. This acquisition should have one more benefit for the company as it is supposed to bring around 150 Demisto’s customers, a quarter of which are in the Fortune 500.

Harvest Capital Strategies’ second biggest position was in Green Plains Partners LP (NASDAQ:GPP), which is a limited partnership established by its parent, Green Plain Inc, which offers terminal and transportation services and ethanol and fuel storage. Green Plains Partners’ shares lost 6.43% over the last 12 months, having a closing price on April 22nd of $16.00. Its market cap is of $370.20 million and the company is trading at a price-to-earnings ratio of 9. The fund held 2.07 million Green Plains Partners’ shares, which carried a value of $28.1 million, amassing 7.84% of its equity portfolio.

When it comes to the largest positions Harvest Capital Strategies established during the last quarter of 2018, we have Dropbox Inc (NASDAQ:DBX) and Compass Minerals International, Inc. (NYSE:CMP). Dropbox is a San Francisco-based company that provides file hosting services such s personal cloud, cloud storage, and client software, to name a few. The Dropbox’ market cap is of $9.87 billion, and over the past six months, its stock price went gained 5.3%, trading on April 22nd at $23.16. For the fourth quarter of 2018, the company disclosed total revenue of $375.9 million, up by 23% from the corresponding quarter of 2017, and GAAP basic and diluted net loss per share of $0.02, compared to $0.19 in the same period one year earlier. It also reported Non-GAAP diluted net income per share of $0.10, compared to $0.03 in the equivalent period of 2017.

Dropbox reported its full year fiscal 2018 results as well, and its total revenue reached $1,391.7 million, which represents an increase of 26% on a year to year basis. Its GAAP basic and diluted net loss per share was $1.35, versus GAAP basic and diluted net loss per share of $0.57 in fiscal 2017, while non-GAAP diluted net income per share was $0.41, compared to $0.17 in the prior year. In the first half of February 2019, Dropbox completed the acquisition of HelloSigh, which is an eSignature and document workflow platform. Harvest Capital Strategies purchased 665,000 Dropbox’ shares, establishing in that manner a position in the company that was worth $13.59 million, at the end of the fourth quarter.

In Compass Minerals International, the fund obtained $3.1 million worth a position, on the basis of 74,339 shares outstanding. This is a big producer of minerals, such as magnesium chloride, salt, and also other plant nutrition products, which operates through several subsidiaries. It has a market cap of $1.89 billion, and it is trading at a price-to-earnings ratio of 27.62. Since the beginning of the year, the Compass Minerals International’s stock went up by 34.41%, having a closing price of $55.74 on April 22nd.

The biggest positions Harvest Capital Strategies decided to drop during the last quarter of 2018 were in Servicesource International Inc (NASDAQ:SREV), Box Inc   (NYSE:BOX), and Carbonite Inc (NASDAQ:CARB). The fund said goodbye to 6 million Servicesource’s shares, which were valued at $17.1 million, 600,000 Box’ shares that carried a value of $14.35 million, and 350,000 Carbonite’s shares, which were worth $12.48 million.

Disclosure: None.

This article is originally published at Insider Monkey.