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Here’s Why Giverny Capital Exited its Liberty Broadband (LBRDA) Stake

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Giverny Capital Asset Management LLC recently published its second quarter investor letter 2022, which can be downloaded here.  The fund’s model portfolio returns declined by 18.48% net of fees in the second quarter of 2022. The current events in the market influenced the stocks’ short-term prices. The fund generated an annualized return of 17.02% over the last nine quarters, net of fees. You can check the top 5 holdings of the fund to see its best picks for 2022.

In the second quarter 2022 investor letter, Giverny Capital Asset Management mentioned that it exited Liberty Broadband Corporation (NASDAQ:LBRDA). Liberty Broadband Corporation (NASDAQ:LBRDA) is a communication business provider and has a market capitalization of $19.494 billion. The company operates in GCI Holdings and Charter segments. The one-month return of Liberty Broadband Corporation (NASDAQ:LBRDA) is 0.25% while its 12-month return dropped to -37.17%. The stock of Liberty Broadband Corporation (NASDAQ:LBRDA) closed at $107.93 per share on July 29, 2022.

Here is what Giverny Capital Asset Management specifically said about Liberty Broadband Corporation (NASDAQ:LBRDA):

"Liberty Broadband Corporation (NASDAQ:LBRDA) is a holding company whose primary asset is shares in the cable and broadband Internet service provider Charter. I like the Charter business – broadband internet service is essentially an unregulated utility – and it hurt to sell Liberty at what feels like a depressed price. But Charter grows modestly and uses debt to boost its returns to shareholders. Specifically, it borrows heavily to finance a large stock buyback. If the economy were to deteriorate for a long time – which is not necessarily what I expect to happen – that debt could become a burden. I believe the businesses I bought will have better organic growth and be less reliant on financial engineering than Charter/Liberty Broadband.”

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As per our research, Liberty Broadband Corporation (NASDAQ:LBRDA) didn’t make it on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our records, Liberty Broadband Corporation (NASDAQ:LBRDA) was in 26 hedge fund portfolios at the end of the first quarter of 2022 compared to 22 in the previous quarter. Liberty Broadband Corporation (NASDAQ:LBRDA) shares lost 35.58% of their value over the last 52 weeks.

Earlier this month, we published another article on Liberty Broadband Corporation (NASDAQ:LBRDA). You can find other investor letters from hedge funds and prominent investors on our hedge fund investor letters 2022 Q2 page.

Disclosure: None. This article is originally published at Insider Monkey.