TMR Capital Q4 2024 Quarterly Letter

2025-03-19 08:35:00 ET

Summary

• The current market dislocations favor our long/short strategy, particularly in undervalued SMID cap tech stocks and special situations, promising strong absolute returns.
• Zenvia's strategic refocus on AI-driven Zenvia Customer Cloud, with potential divestments, positions it for significant growth and market revaluation.
• WM Technology's dominant market position and undervaluation make it a compelling investment; we oppose the lowball acquisition bid and advocate for better capital allocation.
• Our uncorrelated return stream and deep fundamental research in neglected market areas differentiate our approach, ensuring resilience and profitability regardless of market conditions.

Performance

The current market environment is ideal for our long/short strategy and ability to take advantage of dislocations. The cheapest quartile of stocks is the cheapest it has been over the past decade and the most expensive quartile is much more expensive, partly a function of capital flooding out of active and into passive (passive now ~54% of total US equity assets), and partly a function of the increased dominance of Multi-Strategy and quantitative trading firms that invest based on shorter time-horizons. This ongoing phenomenon has resulted in cases where similar assets can have extremely different valuations, providing a fertile hunting ground for longs and shorts....

Read the full article on Seeking Alpha

For further details see: