Here’s Why Palm Valley Capital Management Sold Natural Gas Services (NGS)
Palm Valley Capital Management, an investment management firm, released the “Palm Valley Capital Fund” fourth quarter 2023 investor letter. A copy of the same can be downloaded here. In the fourth quarter, Palm Valley Capital Fund increased 4.00% compared to 15.12% and 14.07% gains for the S&P SmallCap 600 Index and the Morningstar Small Cap Index, respectively. In 2023, the fund increased by 9.47% compared to 16.05% and 20.59% appreciation for the indexes respectively. The fund’s large allocation in Treasury bills contributed to the Fund's 2023 performance being less volatile than benchmarks. In addition, you can check the top 5 holdings of the fund to know its best picks in 2023.
In its Q4 2023 investor letter, Palm Valley Capital Management featured stocks such as Natural Gas Services Group, Inc. (NYSE:NGS). Headquartered in Midland, Texas, Natural Gas Services Group, Inc. (NYSE:NGS) is a natural gas compression services and equipment provider. On January 3, 2024, Natural Gas Services Group, Inc. (NYSE:NGS) stock closed at $15.22 per share. One-month return of Natural Gas Services Group, Inc. (NYSE:NGS) was 14.61%, and its shares gained 31.43% of their value over the last 52 weeks. Natural Gas Services Group, Inc. (NYSE:NGS) has a market capitalization of $189.296 million.
In its fourth quarter 2023 investor letter, Palm Valley Capital Management stated the following regarding Natural Gas Services Group, Inc. (NYSE:NGS):
"The only position negatively impacting full year 2023 returns by at least 10 basis points was Natural Gas Services Group, Inc. (NYSE:NGS). We sold NGS earlier in the year after management laid out a growth plan that included meaningful new borrowings. This violated our internal policy of not holding companies with significant operating and financial risk."
A close-up view of a natural gas compression equipment, with parts and components scattered on the ground.
Natural Gas Services Group, Inc. (NYSE:NGS) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 5 hedge fund portfolios held Natural Gas Services Group, Inc. (NYSE:NGS) at the end of third quarter which was 6 in the previous quarter.
We discussed Natural Gas Services Group, Inc. (NYSE:NGS) in another article and shared Palm Valley Capital Management's views on the company in the previous quarter. In addition, please check out our hedge fund investor letters Q4 2023 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.
