In today’s briefing:
- Palm Valley Capital Fund Second Quarter 2022 Commentary
Palm Valley Capital Fund Second Quarter 2022 Commentary
- The Palm Valley Capital Fund invests in small cap stocks. While our Fund is new, its underlying absolute return-based investment strategy is not. We have practiced the same strategy throughout our careers in investment management.
- Investors’ faith in central banks is currently being tested by the highest U.S. inflation in over 40 years.
- Two-thirds of the nonfinancial members in the Russell 2000 Index are either unprofitable or trade above 20x EV/EBIT.
- The median EBIT growth since 2019 for small caps in the sub 10x EV/EBIT bucket is an astonishing 194%.
- Small caps didn’t sell off enough to create compelling opportunities across the board and the market simply unwound its undeserved gains from 2021.
Before it’s here, it’s on Smartkarma
